Indonesia’s B50 biodiesel plan may boost global CPO prices: Agriculture Minister
JAKARTA,31st May, 2025 (WAM) – Indonesia’s plan to produce and promote the use of Biodiesel 50 (B50) is expected to drive up global crude palm oil (CPO) prices, according to Agriculture Minister Andi Amran Sulaiman.
B50 is a fuel blend consisting of 50 percent biofuel—derived primarily from palm oil—and 50 percent conventional diesel.
Speaking at an event celebrating the government’s success in boosting national rice reserves to 4 million tons in Jakarta, Sulaiman said the government plans to use approximately 5.3 million tons of CPO for B50 production. “Last year, we exported 26 million tons of CPO. What will happen if we cut exports to 21 million tons? Prices will rise,” he said as quoted by Indonesian news agency (ANTARA).
He noted that Indonesia supplies a substantial 65.94% of the world’s CPO, implying that any reduction in exports could significantly impact global prices. “A price hike will translate into better welfare for farmers, right? We’ll be happy to see our farmers prosper,” he told reporters.
Despite the planned cut in exports, Sulaiman assured that shipments to the European Union and the United States would not be affected. “We only need 2.3 million tons for Europe and 1.7 million tons for the U.S., so there won’t be any issues with exports,” he said.
On May 16, Deputy Minister of Energy and Mineral Resources Yuliot Tanjung confirmed Indonesia’s readiness to begin developing B50 next year. He said Indonesia has enough fatty acid methyl esters—an essential biodiesel component derived from vegetable oils through transesterification—to support the initiative.
Tanjung also emphasised that the B50 program would not require the large-scale expansion of oil palm plantations.“We’ll rely on replanting programmes to meet our palm oil needs. So, there will be no extensive land expansion,” he stressed.
