Indonesia has set the September 2026 Market Index Price (HIP) for biodiesel at IDR 15,025 per liter, up IDR 101 from August, excluding transportation costs. The government maintained the CPO-to-biodiesel conversion component at US$85 per metric ton.
PALMOILMAGAZINE, JAKARTA — Indonesia’s Ministry of Energy and Mineral Resources (ESDM) has set the Market Index Price (HIP) for biodiesel at IDR 15,025 per liter for September 2026, an increase of IDR 101 per liter from the previous month.
The new price took effect on September 1, 2026, and excludes transportation costs.
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The pricing is part of Indonesia’s mandatory biodiesel program under Article 18(3) of Presidential Regulation No. 132/2024 on the Management of Plantation Fund.
According to a letter issued by the Directorate General of New, Renewable Energy and Energy Conservation (EBTKE) on August 29, 2026, the government also maintained the CPO-to-biodiesel conversion component at US$85 per metric ton.
The September HIP was calculated under the provisions of Energy and Mineral Resources Ministerial Decree No. 3.K/EK.05/DJE/2024, which governs the HIP for biodiesel blended into diesel fuel. Transportation costs are calculated separately under the relevant provisions of Ministerial Decree No. 290.K/EK.05/MEM.E/2025.
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CPO Price and Exchange Rate
For the September 2026 calculation, the government used an average CPO price of IDR 15,746 per kilogram, based on prices recorded from July 25 to August 24, 2026.
The calculation also incorporated the US$85/metric ton conversion component and a biodiesel density factor of 870 kilograms per cubic meter, before the applicable transportation cost was added.
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The government used the average Bank Indonesia middle exchange rate over the same period. According to the EBTKE calculation, the average exchange rate from July 25 to August 24 stood at IDR 17,924 per US dollar.
Based on these parameters, the government set the September 2026 biodiesel HIP at IDR 15,025 per liter, excluding transportation costs.
Link Between CPO and Biodiesel Pricing
The HIP is a key reference in Indonesia’s mandatory domestic biodiesel program, governing the pricing mechanism for biodiesel supplied for blending with diesel fuel.
For the palm oil industry, the pricing mechanism also highlights the direct link between CPO prices and biodiesel costs. CPO is a key feedstock for Indonesia’s biodiesel industry, while movements in the palm oil market are incorporated into the government’s pricing formula.
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The September increase therefore reflects changes in the underlying parameters used in the monthly calculation, including the CPO reference price and exchange rate.
EBTKE said the policy remains part of the government’s broader energy transition agenda, alongside efforts to strengthen governance and public services in the implementation of renewable and new energy programs. (P2)
