Indonesia-US Trade Agreement: Bioethanol Imports and Commodity Exports

JAKARTA, KOMPAS.com – Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia has affirmed that Indonesia is not obligated to import bioethanol solely from the United States.

According to him, the government still has the flexibility to determine the source of bioethanol supply from various countries, as long as this is done to cover domestic production shortfalls.

“However, as long as our production can meet domestic needs, then there is room for us to import, including importing from America. Until our domestic production needs are met. This is actually done in parallel,” said Bahlil in an online press conference from the US, quoted on Wednesday (25/2/2026).

In addition, the need for bioethanol also comes from the non-energy industrial sector.

He added that bioethanol imported from the US has a price advantage because it enters Indonesia with a customs tariff of 0 percent.

“This is actually beneficial for us. We import from here, the tariff is 0 percent, the price is cheaper. So that our industry is more competitive in using raw materials,” said Bahlil.

Previously, the Agreement on Reciprocal Trade (ART) between Indonesia and the United States had direct consequences for national fuel policy.

Through this agreement, Indonesia must open access and ensure the entry of US-origin bioethanol into the domestic market.

In other words, all domestic regulations must not be an obstacle to bioethanol products from Uncle Sam.

Not only opening up the market, the agreement also links the need for bioethanol with national energy policy.

Indonesia is committed to implementing a bioethanol blending program in transportation fuels, namely E5 by 2028 at the latest and increasing to E10 by 2030.

In the same provision, the government will also strive to increase the blend to 20 percent (E20), considering the availability of supply and the readiness of infrastructure.

The obligation regarding imports is further affirmed in Annex IV: Purchase Commitments, where Indonesia is asked to support and facilitate commercial arrangements for the import of ethanol from the US.