Indonesia and Malaysia commit to biodiesel mandates despite higher prices


Releads, adds malaysian minister, quote, context from paragraph 3

JAKARTA, March 24 (Reuters)Major palm oil producers Indonesia and Malaysia remain committed to their mandatory biodiesel programs despite rising feedstock prices to meet green energy targets, senior officials said Thursday.

Indonesia and Malaysia use palm oil as a blend for biodiesel, with Indonesia using since early 2020 a mandatory B30 – a biodiesel containing 30% palm-based fuel – the highest mandatory blend in the world, to reduce imports of diesel fuel.

Indonesia’s palm oil fuel program “will not stop at B30”, Coordinating Minister for Economic Affairs Airlangga Hartarto told a virtual industry conference.

He said Indonesia is making efforts to use palm oil in its diesel fuel, gasoline and jet fuel.

Indonesia is currently carrying out test flights using jet fuel blended with palm oil and conducting various trials to use it to produce other fuels, as well as road tests on a palm-based biocontent of 40 %.

“The commitment to use palm as a biofuel material will boost Indonesia to achieve energy security and a 23% (renewable) energy mix target by 2025,” Airlangga said.

Renewable energies currently represent around 11% of the Indonesian energy mix.

Airlangga also called for closer collaboration between palm oil producing countries to coordinate their biodiesel programs.

Rival Malaysia has also pledged to maintain and expand its own biodiesel program after pandemic-related delays, its Plantation Industries and Commodities Minister Zuraida Kamaruddin said at the same event.

“Despite the high price of palm oil, the government is committed to maintaining the biodiesel blend ratio and plans to introduce the high blend of biodiesel, such as B30, later,” she said. declared.

The benchmark for palm oil in Malaysia FCPOc3 has gained around 30% so far this year amid sluggish production from the two major producers, export restrictions previously imposed by Indonesia and the effects of the war in Ukraine.

Malaysia plans to implement its nationwide adoption of the B20 (20% palm oil component) palm oil biofuel program by the end of 2022, it said. its palm oil council in January.

The B20 manufacturing mandate for the transport sector was introduced in January 2020 but delayed by coronavirus movement restrictions.

(Reporting by Bernadette Christina Munthe Writing by Fransiska Nangoy Editing by Ed Davies, Martin Petty)

((Fransiska.Nangoy@thomsonreuters.com;))

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