The Indonesian Biofuel Producers Association sees the demand for biodiesel could fall by 12 percent in this year amid the COVID-19 pandemic - Photo by GAPKI Office

JAKARTA (TheInsiderStories) – The Indonesian Biofuel Producers Association sees the demand for biodiesel could fall by 12 percent in this year amid the COVID-19 pandemic. During the first nine month of 2020, the demand biodiesel reached 6.32 million kiloliters and the production reached 6.47 million kiloliters.

Chief executive of the association, Paulus Tjakrawan, said in a virtual discussion on Thursday (03/12), beside the low demands, the decline also due to the fluctuating of world oil prices. Until September, he asserted, the differences between biodiesel and diesel prices has widened by an average of US$461 per ton.

This year, the organization targets that the volume of biodiesel production could reach 9.5 million kiloliters or grow around 14 percent on the annual basis. As is known, the realization of production in 2019 reached 8.3 million kiloliters.

Next year, said Tjakrawan, the production is predicted to break 10 million kiloliters level or rises around 16 percent compared this year. As reported, the government aimed to implementing the 30 percent biodiesel program or B30 in this year and in five years time to run B100 program.

Earlier, President Joko Widodo confident Indonesia could save Rp63 trillion (US$4.47 billion) of foreign exchange by implementing B30 program. He explained, there are three reasons the government continues to accelerate the implementation of the biodiesel program.

First, the program is a form of endeavor to look for new renewable energy sources. Widodo asserted, Indonesia must free itself from dependence on fossil energy which will one day be exhausted. Second, he continued, Indonesia’ dependence on imports of fuel oil is quite high. On the other hand, the country also the largest oil producer country in the world.

“With the potential of such a large palm oil, we have many sources of biofuel as a substitute for diesel fuel. We must exploit this potential to support our national energy security and independence,” said the head of state.

Widodo stressed, that efforts to reduce imports, especially diesel fuel, must seriously. Third, he revealed, the application of B30 will also create huge domestic demand for crude palm oil (CPO). According to him, the implementation of B30 will also have a multiplier effect on 16.5 million oil palm farmers and planters.

Currently, Indonesia’ CPO exports often face challenges in the form of negative campaigns, for example from the European Union.

US$1: Rp14,100

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