decree was awaited by market

Indonesia had actually prepared to release greater biodiesel mix on Jan. 1

Palm oil criteria contract rose 1% after previous fall

Government goes for 50% biodiesel mix in 2026

(Recasts with energy minister’s comment)

By Bernadette Christina and Fransiska Nangoy

JAKARTA, Jan 3 (Reuters) - Indonesia Energy and Mineral Resources Minister signed a decree on Friday assigning 15.6 million kilolitres (KL) of biodiesel for 2025 circulation, while giving the industry until completion of next month to adjust to the greater level of the fuel in the mix.

Indonesia, the world’s largest exporter of palm oil, had actually planned to release the obligatory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.

“The ministerial regulation has actually been signed,” the minister Bahlil Lahadalia told press reporters, adding the government was working to increase the compulsory biodiesel mix to 50% next year.

Eniya Listiani Dewi, a ministry senior authorities, said biodiesel manufacturers and fuel sellers will be offered until Feb. 28 to adapt to the B40 mix. She stated the hold-up was since of technical obstacles linked to aids for the fuel.

The non-implementation on Jan. 1. had led to a 2.6% drop in the Malaysian palm oil benchmark contract on Thursday. On Friday, it recuperated by around 1%.

Fuel retailers and biodiesel producers had said they were not able to draw up agreements for biodiesel circulation without the decree.

The biodiesel allotment for 2025 suggested a boost from 2024’s approximated biodiesel intake of 12.98 KL, ministry information revealed on Friday.

Of the overall allocation for this year, 7.55 million KL is for the public service responsibility (PSO), which covers sectors such as public transport, whose sales will be subsidised by the nation’s palm oil fund.

“The remaining allowances will be offered at market value. The non-PSO allotment is set at 8.07 million KL,” Bahlil stated, adding the fund might not subsidise the cost space in between the palm oil and nonrenewable fuel sources for the total allotment.

BPDPKS, the agency in charge of collecting and managing the palm oil funds, approximated in November B40 would require a 68% aid boost.

To assist fund that, Indonesia prepares to increase its export levy for crude palm oil (CPO) to 10% from the current 7.5%, but for that to occur, another main regulation is needed. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati