Indonesia to trim palm oil exports as demand climbs, output dips

In Indonesia, The Jakarta Post reports on September 19, at the Globoil conference in Mumbai, Fadhil Hasan of the Indonesian Palm Oil Association informed Reuters that Indonesia’s palm oil exports are set to decrease by 2 million tons to 30.2 million tons in 2024 due to increased domestic demand for biodiesel and reduced production.

The drop in production, likely down 1 million tons to 53.8 million, is attributed to last year’s dry weather, which impacted yields. This reduction, along with the nation’s 35% biodiesel blending mandate, which began in August 2023, is expected to support Malaysian Palm Oil Futures and decrease Indonesia’s export surplus, as more palm oil is consumed domestically.

The government plans to increase the blending mandate to 40% by January 2025 to reduce reliance on fossil fuels and support the biodiesel program. Hasan emphasized the importance of balancing production trends and export revenues to maintain the program’s sustainability.