Indonesia raises 2022 biodiesel allocation

Indonesia has lifted its domestic biodiesel allocation to 10.151mn kilolitres (kl) in 2022 from 9.21mn kl last year.

Jakarta is maintaining a 30pc biodiesel blending (B30) mandate but expects overall transport fuel consumption to rise as the country emerges from Covid-19 restrictions.

Indonesia’s state-owned refiner Pertamina will receive the largest share of 8.3mn kl, followed by its trading arm AKR Corporindo taking 730,501 kl and PT Exxonmobil Lubricants Indonesia with 687,947 kl.

Wilmar, Musim Mas and Apical are the three biggest of the country’s total 18 suppliers that will be distributing the biodiesel. Wilmar’s share has slipped to 2.4mn kl from 3.09mn kl last year and Musim Mas’ to 1.23mn kl from 1.43mn kl. But Apical’s share has swelled to 1.9mn kl from 882,242 kl alongside a doubling of its production capacity to around 2mn t/yr.

Fuel sellers hit nearly 98pc of the 9.21mn kl target for 2021, which the energy and mineral resources ministry estimates led to $4.54bn in foreign exchange savings.

But the B30 mandate is supported by export duties on palm oil products used to bridge the gap between diesel and gasoil prices, which widened considerably last year as vegetable oil costs hit record highs on the back of global supply shortages.

The Indonesian oil palm plantations fund management agency distributed 51.86 trillion rupiah ($3.6bn) until November 2021 compared with Rp28 trillion in 2020, although this included some carryover from the previous year.

The government was forced to drastically expand palm oil duties to help fund the B30 mandate in December 2020, but receded in June last year to appease producers priced out of international markets.

Regardless, it is targeting to implement a B40 programme by 2025 incorporating Pertamina’s growing hydrotreated vegetable oil production in the country.

Source: argusmedia

Tags: Biodiesel, Indonesia, Pertamina
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