GAPKI: Mandatory B20 will lift CPO prices

Nusa Dua, (Antaranews Kalsel) - The implementation of the B20 biodiesel mandatory program is believed to be able to raise the price of Crude Palm Oil (CPO) on the world market. This policy of mixing diesel and palm oil is also a solution to the absorption of palm oil stocks amid slowing demand in the export market.


The Chairperson of the Indonesian Palm Oil Producers Association (GAPKI) Joko Supriyono in Nusa Dua, Wednesday (31/10) said he totally agreed with what the Indonesian President Jokowi said that the B20 program would increase the absorption of palm oil in the domestic market.

"Reducing crude oil imports and replacing it with palm biodiesel will have a positive impact on the trade balance and this will help reduce the trade balance deficit and of course it will reduce the impact of fluctuations in the rupiah exchange rate," he said.

He explained, this year national palm oil production could reach 42 million tons, 30 million tons would be exported. Looking at the size of palm oil production, the B20 biodiesel mandatory program for will never experience difficulties in raw materials.

President Joko Widodo said there are five things must be done in the development of the national palm oil industry, one of which is the implementation of B20 biodiesel continues to be accelerated and implemented optimally.

It was admittedly though decided last year, the implementation is still not running as fast as expected and this is being pursued so that its use can be 100 percent, till existing CPO stocks can be absorbed.

"Why do we import oil if we can use biodiesel blends from oil palm, it will automatically boost the price of palm oil itself," he said at the opening of the 14th International Palm Oil Conference (IPOC) and Price Outlook 2019.

According to him, this is a trading trick that must be done, replacing all the machines, both the engine and the power plant. All use diesel, but this also requires time.