PALMOILMAGAZINE, JAKARTA – To respond to the European Union’s (EU) declaration of a trade war via the European Union Deforestation Regulation (EUDR) targeting palm oil, Indonesia is considering a strategic move by accelerating the Biodiesel 100 percent (B100) program.
Minister of Defense Prabowo Subianto has emphasized the significance of this response amid the trade tensions. Biodiesel stands out as a flagship initiative under the Ministry of Agriculture.
Indonesia and Malaysia, together accounting for 60 percent of global palm oil production—Indonesia with 50 million tons and Malaysia with 20 million tons—are pivotal players in the global market and aim to assert regulatory dominance.
Also Read: EU Declares Trade War: Why Not to Worry
We should fight the war invitation from West Europe. Indonesia is the pioneer to produce biodiesel fatty acid methyl ester (FAME) and biodiesel gasoline. Besides, Indonesia has mining products that EU needs of, such as, bauxite as the main material to produce aluminum and nickel for steel that is anti-carat, making coins, produce plane, nuclear reactor industries, and coal. The mining could be used as weapons in the trade war.
The elected President PrabView Postowo Subianto has his big targets to realize environmental fuel (B100) in his leadership. If it is realized, we would need, at least, 92 milion tons/year while at this time (2024) it reaches 50 million tons. So it needs to multiply 43 million tons more, including for palm oil gasoline, palm cooking oil and other industries in this country (see tables below).
The increasing palm oil productivity would certainly “be easy to do”. There have been technologies, such as, production force management that enables to escalate productivity between 30 – 80%. Besides, if every available land bank is planted, palm oil plantations could be wider to be 20 million hectares. Smallholders replanting program (the program to plant fake, old seeds by superior and certified seeds), improving the fertilization system, finding the new superior seed cross, and others could escalate palm oil production nationally. The abandoned palm oil plantations should be handed over for the Enterprises to deliver advantages for the country and the people around.
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The additional needs in this country would happen for the increasing population and income, the increasing biodiesel use. The increasing palm oil gasoline for the next 2 to 3 years to go, would add the production. The needs for exports should be stable at about 22 – 25 million tons only but should be in derivative products, not in the form of crude palm oil (CPO). It means, CPO price in the world could be more expensive because its needs could be increasing in phase.
Minister of Enterprises, Arifin Tasrif could be pessimist to this program (Kompas.com, 16/5/2024. He said something about what the elected President Prabowo Subianto said to realize B100. Next year, Indonesia would escalate the mixture to be B40. Hopefully it would happen. We have prepared it with many road tests, he said. Meanwhile to escalate to be B100, he continued, it needs to consider the materials and market potential. “It has something to do with the balance and material availability and markets,” Arifin said. (Liputan6.com, 16 May 2024).
The worse was spoken by Chairman of Asosiasi Petani Kelapa Sawit Indonesia (Apkasindo), Gulat Manurung that said the policy would make Indonesia ‘deficit in CPO’. In B50, we are minus 1,2 million tons CPO. “It means, we could not export others. If we do not export, we do not get the exchange,” Manurung said (Detik.com, 27 May 2024)
In fact, Ministry of Agriculture did B100 road test for cars and tractors since 2019. Minister of Agriculture, Amran Sulaeman thought further that tractor producers (the partners of Ministry of Agriculture) were suggested to adjust the tractor machine for biofuel (biodiesel). He thought, the use of 1 liter – B100 should run the vehicle up to 13,1 kilometers, much farther than the vehicles using 1 liter diesel that goes for about 9,6 kilometers only (Katadata.co.id, 15 April 2019).
As a matter of fact, the quality of biodiesel is better than fossil diesel. FAME is diesel material for fuel. It is made of CPO by having trans-esterification process. FAME is not toxic and it is biodegrable. FAME has the rank “the cetana for about 56” which is bigger than diesel while “the cetana for diesel just reaches 48”.
It is no need to worry about a lack of materials. If (the government) realized B100, palm oil production could reach 92 million tons, even 100 million tons iin 2030–2022. It is just about the whole efforts from the stakeholders to cooperate to realize it. this is the homework for General Directorate of Plantation Ministry of Agriculture and Indonesian Palm Oil Association (IPOA).
The safe exchange from diesel imports, as data published by Asosiasi Produsen Biofuel Indonesia (Aprobi) mentioned, reached Rp 173,2 trillion (13,15 million kiloliters) in 2023, would be safer to be Rp 577.3 trillion (43.8 million kiloliters) in 2030, if B-100 is really implemented.
Disclaimer: This article is personal opinion
