As a result, the industry has been reluctant to supply biodiesel because prices offered by PT Pertamina, which blends the product, are below commercial prices.
Biofuels firms have received purchase orders from Pertamina but they have been delaying deliveries, or just stopped supplying the state-run fuel distributor.
Indonesian palm-based biodiesel firms could process up to 2.5 million tonnes of palm oil a year, or about 14% of the country’s palm output, if they run at full capacity. But they could lose about €0.142 per litre for selling their product to Pertamina on par to subsidised mineral-based diesel, which is now priced at €0.317 per litre.
