JAKARTA – The development of palm oil-based biodiesel industry in Indonesia has not only increased the production, consumption and price of crude palm oil (CPO). It has also stabilized CPO prices and created new job opportunities in the country.

The Association of Indonesian Biodiesel Producers’ (APROBI) Deputy Chairman Suwandi Winardi said that the biodiesel industry had also contributed to the eradication of poverty, especially among the smallholders, and pushed up the local economies.

According to him, the biodiesel industry in Indonesia is still focused in Sumatera, but slowly it will be growing in Kalimantan and Sulawesi.

“Currently, total installed production capacity of biodiesel in Indonesia reached 20 million kiloliters per year with total investments of US$2 billion,” Suwandi said during a seminar on considering the balance of CPO production for domestic need and exports and its urgency and challenge on Wednesday (19/06/2024).

But despite its positive contribution to Indonesian economy, Suwandi said the biodiesel industry is facing a number of challenges, which include the quality problem.

“Producers are required to maintain and increase the quality of their biodiesel production. The plan to upgrade biodiesel mixture should be also accompanied with keeping quality of blending,” he said.

According to him, other challenges include its handling and storage. “Drawing lessons from the past, producers have been continually improving their quality of biodiesel production and distribution. That’s why we need collaborations with other stakeholders,” he said.

“We’re also facing the problem of price. We’re trying to reduce the spread between the price of diesel fuel and biodiesel,” he said.

He said that the government has planned to upgrade the biodiesel mandatory program from the current B35 to B40 in 2024. “This will pose a new challenge. We’ve been successful in implementing the biodiesel mandatory program for the last 10 years, and we should capitalize on our success,” he said.

Suwandi hopes that there will be specific regulations and serious synergy among all palm oil stakeholders, the government, producers from upstream to downstream, research centres, associations, and the oil palm plantation fund management board (BPDPKS). “We need conducive regulation and collaboration to sustain our biodiesel production,” he said. (*)

Source: sawitku.id