Indonesia's Thirst for Biodiesel May Undercut Global Palm Oil Supply

[Indos]

The government began mandatory use of B30 biodiesel – made up of 30 percent palm oil-based biofuel – in December 2019. (Antara Photo/Aprillio Akbar)

BY :NUR YASMIN, RIDHO SYUKRA

FEBRUARY 04, 2020

Jakarta. The Indonesian Palm Oil Association, or Gapki, said on Monday that Indonesia is likely to use up 8.3 million tons of palm oil to meet domestic demand for biodiesel this year, raising concerns there won't be enough palm oil left to export.

The government began mandatory use of B30 – diesel fuel made up of 30 percent biofuel from palm oil – last month and is already preparing to use the upgraded version, B40, next year.

"Domestic demand for palm oil in 2020 is estimated to reach 8.3 million tons to be processed into biodiesel, which may reduce heavily the amount of palm oil available for export," Gapki's executive director, Mukti Sardjono, said in a statement on Monday.

On the production side, Gapki said expected favorable weather may help the country produce a higher output than last year.

Indonesia's crude palm oil and palm kernel oil production hit a record 51.8 million tons last year, up 9.1 percent from 2018, despite a long drought.

Crude palm oil (CPO) production rose 9.4 percent to 47.2 million tons while palm kernel oil production increased 8.6 percent to 4.6 million last year from the previous year, Gapki data showed.

Exports – despite the adverse effects of the United States-China trade war, India's tariff discrimination and the European Union's biodiesel ban – still managed an increase of 4 percent to 36.2 million.

"The US-China trade war put a strain on the former's soybean exports. US farmers who used to ship large quantities to China were forced to find new markets, putting huge pressures on the prices of oilseed and edible vegetable oils," Mukti said.

As a result, CPO prices in the global market have been under pressure since the first half of last year. Gapki estimated the export value of palm oil products, including oleochemicals and biodiesel, had declined to $19 billion last year, down 17 percent from $23 billion in 2018.

The decline in export value could have been more severe, but the CPO price recovered after President Joko "Jokowi" Widodo announced in his state address that Indonesia would increase domestic use of CPO for biodiesel.

CPO price closed at $800 per ton in Rotterdam port at the end of last year, almost twice the price it was in August, as Indonesia began using the B30.

Wuhan Outbreak

Gapki said the coronavirus outbreak in China is likely to hamper Indonesia's palm oil exports there.

The world's second-largest economy was Indonesia's largest CPO and kernel palm oil market, buying a total of 6 million tons last year ahead of India (4.8 million tons) and the European Union (4.6 million tons).

China was also the biggest buyer of Indonesia's oleochemical and biodiesel products. The country imported 825,000 tons of the commodities from Indonesia last year, ahead of the EU's 513,000 tons.

"I hope the coronavirus outbreak will not last too long since all export activities to China have been stopped temporarily," he said.

Indonesia could still take confidence in the increase in CPO demand in other markets like Africa, which imported 2.9 million tons of palm oil products last year, up 11 percent from 2018.

https://jakartaglobe.id/business/indonesias-thirst-for-biodiesel-may-undercut-global-palm-oil-supply

 

[Indos]

Pertamina requests palm oil DMOs to run the B100 program

Nicke Widyawati, Pertamina President Direcor

KONTAN.CO.ID - JAKARTA. In an effort to develop biodiesel through B100, PT Pertamina (Persero) asked for government support through the domestic market obligation (DMO) policy for palm oil.

Pertamina President Director Nicke Widyawati said that the expected palm oil DMO policy would later include the volume and price of palm oil.

"We need DMO support, as PLN building 35,000 MW requires a large coal supply," Nicke explained at the House of Representatives Commission VII Building, Wednesday (1/29).

Also Read: No longer with ENI, Pertamina opens an option to partner with new partners in the green refinery project

Nicke continued, Pertamina hopes to apply the upper and lower limits for the price of palm oil.

Meanwhile, the lower limit includes production costs plus margins to maintain the business continuity of palm oil producers and the upper limit according to market prices in order to maintain the continuity of Pertamina's business.

Not only that, another form of support needed by Pertamina is from the taxation sector.

Nicke said, the CPO processing that takes place outside the refinery is usually taxed.

"From Crude Palm Oil (CPO) to Fatty Acid Methyl Ester (FAME) is subject to tax, when it is processed again, it hits again, so we need support," Nicke explained.

In order to realize the B100 program target, Pertamina will take three main steps, including the medium to long term plan.

The first step taken is through a co-processing scheme in the stages of biodiesel production.

Meanwhile, through this scheme, Pertamina mixes crude oil with Refined Bleached Deodorized Palm Oil (RBDPO).

Nicke revealed that this scheme has been applied to the Plaju and Dumai refineries since two years ago. Until now, this scheme is claimed to have successfully mixed RBDPO with a mixture of 20%.

"This year it will be implemented in Cilacap which is considered to be ready for coprocessing so that its capacity can be increased and subsequently applied throughout Pertamina's refineries," said Nicke.

Also Read: Transition of Rokan Block, Pertamina Managing Director: We are ready but still follow the rules

The second step is to build a new green refinery unit in Plaju. The project, which also cooperates with the Italian oil and gas company, ENI, is now run alone by Pertamina.

"So we will go it alone. The capacity is 20 thousand barrels per day for each unit. Then if you want 80 thousand, it means 4 units and will produce 1 million kiloliters per year," explained Nicke.

The project itself is expected to start operating in 2024.

Also Read: The Directorate General of Taxes gives special treatment to Pertamina's tax audits

The third step is to take the process of repairing alias revamping at the Cilacap Refinery.

The Cilacap Refinery revamping program is targeted to be completed in 2022 and will be implemented elsewhere.

Through this step, the B100 product capacity is predicted to reach 300 thousand tons per year

Revamping scheme is considered important to do in order to allow mixing FAME with diesel.

Nicke revealed, mixing can usually only be done at a maximum level of 30%.

"The rest if you want B40 or B50 must be added Hydrotreated Vegetable Oil (HVO) or B100. So if B50 is 20 fame 30 HVO," explained Nicke.

https://industri.kontan.co.id/news/...yak-sawit-demi-jalankan-program-b100?page=all

 

[Indos]

Indonesia to start trial use of 40 percent biodiesel (B40) fuel in March: Association

• News Desk
  The Jakarta Post
  

Jakarta / Tue, February 11, 2020 / 04:06 pm

Energy and Mineral Resources Minister Ignasius Jonan (second right) accompanied by Deputy Minister Arcandra Tahar (right) fills a car with 30 percent biodiesel (B30) fuel during the launch of the road test for the palm oil-based biofuel in Jakarta. (Antara/-)

The Indonesian Biodiesel Producers Association (APROBI) has said it will start the trial use of 40 percent biodiesel (B40) fuel in March, as a follow-up to the successful implementation of 30 percent biodiesel (B30) fuel.

APROBI chairman MP Tumanggor said the trial, starting in March, was in line with President Joko “Jokowi” Widodo’s plan to implement B40 fuel fully in January 2021, as reported by kompas.com on Monday.

“I just received a letter from the oil and gas research agency for us to send the raw material for the trial,” Tumanggor said.

He said there would be two models to be tested for the B40 fuel, which is produced by distilling crude palm oil (CPO) and infusing fatty acid methyl ester (FAME) to the mix to reach the expected level.

The government is eager to increase the mix of palm oil in diesel fuel to reduce oil imports, which contribute heavily to the country's trade deficit.

Regarding the implementation of B30 fuel, Tumanggor said the program had gone well since its commercial debut in January.

The B30 fuel is set to consume 9.6 million kiloliters of palm oil this year.

“As of now, [the use of B30 fuel] is still going according to plan with regard to the automotive industry, the supply chain from Pertamina and producers,” he said, adding that the B30 fuel is expected to use a total of 800,000 kiloliters of vegetable oil. (mpr)

https://www.thejakartapost.com/news...-biodiesel-b40-fuel-in-march-association.html

 

[Indos]

CN235-220 FTB Aircraft Conducts Ground Test With J2.4 . Bioavtur

2021-09-06 00:00


PRESS CONFERENCE

No. PTD/0 15 /SP-HUMAS/I X /2021

Bandung, 06 September 2021 – PR PTDI

Involved in the national program to achieve energy independence, the CN235-220 Flying Test Bed (FTB) aircraft conducted a ground test for the first time with Bioavtur J2.4 fuel, which is a mixed bioavtur fuel produced from 2.4% palm kernel oil as raw material. or Refined Bleached Degummed Palm Kernel Oil (RBDPKO) using a catalyst, the product of a collaboration between the Bandung Institute of Technology (ITB) and PT Pertamina (Persero).

The national bioavtur program is run in a consortium consisting of the Bandung Institute of Technology (ITB), Bioenergy, PT GMF Aeroasia, PT Pertamina (Persero), DKPPU, IMAA, DPNPKS, Lemigas and PTDI, under the auspices of the Ministry of Energy & Mineral Resources (ESDM). ).

The ground test was carried out this morning for 20 minutes by the PTDI test team led by Captain Adi Budi at the PTDI Aircraft Services Apron Hangar, which was witnessed by the Expert Staff of the Minister of Energy and Mineral Resources for the Integration, Coordination and Interface of Oil & Gas, Nanang Untung and the Chief Researcher. ITB's catalyst, Subagyo, as well as PTDI's President Director, Elfien Goentoro and PTDI's Director of Commerce, Technology & Development, Gita Amperiawan.

The CN235-220 FTB aircraft filled with J2.4 Bioavtur fuel is a vehicle for PTDI in conducting testing and development to the new system certification process before it is implemented on the customer 's CN235-220 aircraft .

"With the trust given by the J2.4 Bioavtur development consortium to use bioavtur fuel in the CN235-220 FTB aircraft, it is hoped that it can support the use of biofuels in the aerospace industry sector and can increase energy independence, especially the combination of the use of avtur and palm oil," said Gita Amperiawan, Director of Commerce, Technology & Development of PTDI.

The ground test is the last stage before the flight test is carried out . It is planned that 2 (two) flight tests will be carried out in the second week of September 2021, before the aircraft is flown to Soekarno Hatta Airport Cengkareng on September 15, 2021.

"From the results of the tests that we just carried out, the first is the right engine start using J2.4 bioavtur then followed by the left engine start using Jet A1 aviation fuel, everything is normal with no abnormalities . Then we did a power check with the first power being flight idle and gradually increasing it to the maximum takeoff power . After that, the last thing we do is evaluate the engine response during acceleration and deceleration. Followed by a quick change from maximum power to flight idlefollowed by slamming to maximum power . From all the tests carried out, the engine response is all normal and there is no visible difference compared to when using Avtur fuel, "explained Captain Adi Budi.

The results of the ground test and flight test of the CN235-220 FTB turboprop aircraft using Bioavtur J2.4 will then become important data and input for the authorities in Indonesia, in this case the Directorate of Airworthiness and Aircraft Operations (DKPPU) of the Directorate General of Air Transportation and Indonesian Military Airworthiness Authority (IMAA).

This effort to implement bioavtur will certainly have a positive impact on achieving the contribution of NRE, where the National Energy Policy has set a target for the use of new and renewable energy of 23% by 2025. It is hoped that the use of green avtur in Indonesia can be implemented optimally in the context of reducing greenhouse gas emissions. (GRK) to accelerate the achievement of NRE targets in the national energy mix in accordance with PP 79/2014 concerning National Energy Policy and Presidential Regulation 22/2017 concerning General National Energy Plans.

For more information, you can contact:

Adi Prastowo

Corporate Communications & Promotion Manager

PT Dirgantara Indonesia (Persero)

PT. Dirgantara Indonesia (Persero)

www.indonesian-aerospace.com

 

[Indos]

Our coal mining has DMO (Domestic Market Obligation) and they cannot sell above 70 USD per ton for domestic industry, so this is why Indonesian electricity bill is still stable despite the hike of coal price internationally (more than 100 USD per ton currently). This is also why our inflation is still very low amid the surge of commodities prices that we are currently experiencing since the beginning of this year. While for oil, it is mainly consumed by consumers so the increase in price doesnt transmit into higher inflation.

In order to make the program successful for Biofuel, so DMO should be implemented with the price ceiling as well.

Talking about price, it is Indonesia who help CPO price last year when almost all commodity price is crash through this Biofuel program. Malaysia doesnt have similar program.

For future CPO price, at least until the end of this year, the price is expected to keep climbing or at least stay at current high price. It is due to Malaysian palm oil industry who rely mostly on foreign labors where current situation make them difficult to keep the production at maximum level where foreign labors are still difficult to enter Malaysia due to their Covid measure and high infection case ( 2 times higher than Indonesia ).

 

[Viet]

Not a good thing burning down rain forest to plant more plan trees for more fuel for cars
The planet is finished.
I avoid as much as possible to fill my car with B10. B5 is mandatory here in Germany otherwise I won’t use it.
Good: the EU will ban this bio fuel soon.

 

[Indos]

Not a good thing burning down rain forest to plant more plan trees for more fuel for cars
The planet is finished.
I avoid as much as possible to fill my car with B10. B5 is mandatory here in Germany otherwise I won’t use it.
Good: the EU will ban this bio fuel soon.

No burning down rain forest is allowed in Indonesia. People/Company will face huge fine and possibly prison cell as well if they keep doing that. We have used satellite and the apps to detect any hot spot in places like Sumatra and Kalimantan islands.

This is Europe gets their biofuel and substitute Palm Oil.

Look how they are harvested, the land becomes dull

This is when Palm Oil being harvasted, you can see the tree that produce Oxigent for the world and region is still in tact

 

[Viet]

No burning down rain forest is allowed in Indonesia. People/Company will face huge fine and possibly prison cell as well if they keep doing that. We have used satellite and the apps to detect any hot spot in places like Sumatra and Kalimantan islands.

This is Europe gets their biofuel and substitute Palm Oil.

Look how they are harvested, the land becomes dull

This is when Palm Oil being harvasted, you can see the tree that produce Oxigent for the world and region is still in tact

I am against any sort of bio fuels. I once visited a farm where they plant potatoes then let them rot to make fuel. At the beginning I thought wow great stuff. But think about it, people go hungry in many countries but here we grow foods then instead we eat it we fill cars gas tanks.

 

[nufix]

I am against any sort of bio fuels. I once visited a farm where they plant potatoes then let them rot to make fuel. At the beginning I thought wow great stuff. But think about it, people go hungry in many countries but here we grow foods then instead we eat it we fill cars gas tanks.

Except palm oil is not staple food. Furthermore, CPO production is over 51 million tons and domestic consumption currently accounts for just over 17 million tons. So there are enough CPO to spend for biodiesel.