Rising Biodiesel Use Makes Palm Oil Supply Key to Energy Security

Therefore, policy focus is no longer solely on downstream processing, but also on strategies to strengthen supply, particularly through increasing productivity in existing plantations. The government has implemented B40 biodiesel and targets a gradual increase towards B50. This is where palm oil supply becomes the backbone of the policy. Because, fresh fruit bunches (FFB) and crude palm oil (CPO) are not merely export commodities, but raw materials that must be allocated for multiple needs at once, from food, energy, to industrial and foreign trade requirements. If palm oil supply cannot keep up with the increasing biodiesel needs, the impact could spread to various sectors. Domestic supply could be strained, triggering rises in cooking oil prices, disrupting food stability, and reducing export volumes. Additionally, supply unpreparedness could potentially add to fiscal burdens and inflationary pressures.