Agriculture Minister: B50 implementation will not disrupt cooking oil supply

Agriculture Minister Andi Amran Sulaiman has assured that the implementation of Biodiesel 50 (B50) will not disrupt national cooking oil supplies because Indonesian palm-oil production is rising and remains in surplus for domestic needs. ‘You know, our production is rising; this is data from Gapki (Gabungan Pengusaha Kelapa Sawit Indonesia),’ the minister said in Jakarta on Tuesday. He said that the increase in crude palm oil (CPO) production means Indonesia still has stock and a surplus of supply even though part of production is allocated to support the national biodiesel programme B50 this year. Amran noted national palm-oil production is around 46 million tonnes, so the government is optimistic that the needs for biodiesel, domestic cooking oil, and exports can be met simultaneously. ‘So, originally (palm-oil production) 46 million tonnes, 20 million tonnes for cooking oil and others. Then 26 million tonnes for exports, now (has risen to) 32 million tonnes. If you allocate 5 million tonnes, there is still a surplus of 1 million for B50,’ Amran said. He compared the current condition with before when Indonesia’s palm-oil export volume was around 26 million tonnes before substantial growth in national production in recent times. In the current national-need framework, Amran said the allocation for B50 implementation is estimated at about 5-6 million tonnes of the total national palm-oil production. Meanwhile, domestic demand for cooking oil and other needs is said to be around 20 million tonnes, so the B50 programme is considered not to disrupt public needs. He said the data on production and export calculations for palm oil come from Gapki, which has long been a reference for the condition of the national palm-oil industry. The government is optimistic that B50 implementation can balance national energy interests, public cooking oil needs, and the sustainability of Indonesian palm-oil exports to international markets that account for around 60%. Earlier, Coordinating Minister for Economic Affairs Airlangga Hartarto said Indonesia would implement Biodiesel 50 (B50) or a 50 percent palm-oil blend with diesel to save subsidies amounting to Rp48 trillion. He said Pertamina is ready to implement the policy. The B50 policy, Airlangga said, has the potential to reduce fossil-fuel oil consumption by 4 million kilolitres in one year. ‘Of course, in six months there will be savings from fossil energy and also subsidy savings from biodiesel estimated at Rp48 trillion,’ Airlangga said. On that occasion, Energy and Mineral Resources Minister (ESDM) Bahlil Lahadalia said with B50 implementation, Indonesia will experience a diesel surplus by 2026. ‘So, this is good news, once the RDMP Kalimantan Timur (Balikpapan refinery) is operational,’ he said.