Indonesia will increase palm oil export tax if it abandons its plan to introduce B50 Biodiesel in this year.

Yuliot Tajung, the deputy energy minister, said that Indonesia had scrapped plans to raise the mandatory biodiesel mix to 50% in 2019. Instead, it will maintain the current blend of 40% palm oil based fuel and 60% diesel.

Indonesian energy minister had previously planned to implement the 50-50 mixture of palm oil-based diesel and fuel in the second half of this year to reduce the country's dependency on imported diesel.

Eniya. Listiani. Dewi, an official with the energy ministry, told reporters that the decision was made to maintain B40 fuels this year as the government reviewed the timeline needed to complete the trials of B50,. especially for trains, heavy equipment and machinery.

Yuliot said that the recent increase in Indonesia’s diesel fuel production was a major factor in this decision.

She added that the new timeline for B50 would be determined after the trials.

Eddy Abdurrachman is the chief of Indonesia's estate funds agency. He said that Indonesia will increase?crude export levies on palm oil to 12.5% from March?1. The levy on'refined products' will be increased by 2.5 percentage points.

Indonesia, which is the largest palm oil producer in the world, collects levies of?10% on crude palm oils, while the rates for refined palm oil range between 4.75% to 9.5%.

(source: Reuters)