Indonesia may cut biodiesel subsidies to spur production

Kuala Lumpur

INDONESIA is considering lowering the amount of biodiesel subsidy it provides per kilolitre to enable higher subsidised volumes of the biofuel, which counts crude palm oil as feedstock, an industry official said.

Indonesia has made it mandatory for all biodiesel to contain a minimum 20 per cent blend of bio content in its so-called B20 programme, but not all biodiesel producers comply with the regulation as blending would incur higher costs at current oil prices.