Indonesia’s Energy Ministry has set the October 2026 Market Index Price (HIP) for palm-based biodiesel at IDR 15,072 per liter, excluding transportation costs, based on CPO prices and the government’s biodiesel pricing formula.
PALMOILMAGAZINE, JAKARTA — Indonesia’s Ministry of Energy and Mineral Resources (ESDM) has set the Market Index Price or Harga Indeks Pasar (HIP) for biodiesel at IDR 15,072 per liter for October 2026, excluding transportation costs.
The new benchmark took effect on October 1 as part of the government’s mandatory biodiesel program, which links Indonesia’s palm oil industry with the country’s renewable fuel sector.
Also Read: Indonesia Sets September 2026 Biodiesel HIP at IDR 15,025/Liter, Up IDR 101
According to an official statement from the Directorate General of New, Renewable Energy and Energy Conservation (EBTKE) cited by PalmOilMagazine on Tuesday (Oct. 6, 2026), the price was stipulated in Letter No. B-3157/EK.05/DJE.B/2026 dated Sept. 28, 2026. The letter was signed by EBTKE Director General Eniya Listiani Dewi.
The government also set the CPO-to-biodiesel conversion component at US$85 per metric ton, while transportation costs are added in accordance with applicable regulations.
The October 2026 biodiesel HIP calculation was based on the average CPO price at KPB during Aug. 25–Sept. 24, 2026, which stood at IDR 15,820 per kilogram.
Also Read: Palm Oil Price Seen Reaching US$1,172/Ton in 2026 as Biodiesel Supports Indonesia’s Market
Under the government formula, the average KPB CPO price is combined with the US$85-per-ton conversion component, converted using a factor of 870 kilograms per cubic meter, and then adjusted for transportation costs.
The exchange-rate component uses the average Bank Indonesia middle rate during the same period, which was IDR 17,702 per US dollar.
The biodiesel HIP determination refers to ESDM Ministerial Decree No. 3.K/EK.05/DJE/2024, which regulates the market index price for biodiesel blended into diesel fuel. Transportation costs are governed by Appendix I of ESDM Ministerial Decree No. 290.K/EK.05/MEM.E/2025.
Also Read: CPO Prices Forecast to Stay High Through 2027 on El Niño Risk and Biodiesel Demand
CPO Prices Remain a Key Driver
The biodiesel HIP is directly linked to CPO price movements because palm oil is the primary feedstock for Indonesia’s biodiesel industry. Changes in CPO prices therefore remain an important factor in determining the government’s biodiesel price index.
For Indonesia’s palm oil industry, the pricing mechanism forms part of the broader mandatory biodiesel policy, connecting the plantation sector with the national energy market. The HIP serves as a key reference in determining biodiesel prices under the government’s regulatory framework.
Also Read: Indonesia’s B50 Biodiesel Push Puts Smallholder Access to CPO Supply Chain in Focus
With the October 2026 HIP now in effect, biodiesel producers and other industry stakeholders must use the newly established benchmark while incorporating transportation costs in accordance with prevailing regulations.
The latest determination also highlights the continued influence of CPO prices on Indonesia’s biodiesel pricing mechanism, as the government seeks to expand the use of palm-based renewable fuel through its mandatory biodiesel program. (P2)
