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Biofuel Policy Could Cut Exports
INDONESIA - Indonesian palm oil exports could fall as the government demands more should be blended with traditional fuels.Use of one per cent biodiesel mix became mandatory from 26 September and it has been forecast that exports will fall as a consequence.
The mix was set at 2.5 per cent for industrial users and the government also laid down a one per cent bioethanol mix for cars using subsidised fuel starting in 2009, while industries using gasoline must ensure five per cent of the fuel has bioethanol.
Business press reports say that the mandatory bioenergy policy will see the use of agricultural products for fuel increase.
Indonesia’s biofuel industry can produce between 1.3 million tonnes to 1.5 million tonnes annually. Capacity may double to 3 million tonnes by 2010.
The country’s palm oil output will be more than 19 million tonnes next year and exceed 20 million in 2010 and the food and chemicals industry may use 4.5 million tonnes this year and next, and 5 million tonnes in 2010 according to a report in Business StandardBusiness Standard.
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