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<br>[Indonesia](https://www.intelligentinvestor.com.au/shares/asx-mbt/mission-newenergy-limited/share-price) firmly insists B40 biodiesel execution to continue on Jan. 1<br> |
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<br>Industry participants looking for phase-in duration anticipate gradual introduction<br> |
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<br>Industry faces [technical challenges](https://www.zoominfo.com/c/mission-newenergy/346542889) and cost issues<br> |
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<br>Government financing concerns arise due to palm oil cost disparity<br> |
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<br>JAKARTA, Dec 18 (Reuters) - Indonesia's strategy to broaden its [biodiesel](https://biodieselmagazine.com/articles/felda-global-buys-missions-kuantan-port-plant-for-11-5-million-9053) required from Jan. 1, which has sustained concerns it might curb international palm oil supplies, looks progressively likely to be carried out gradually, experts said, as market individuals look for a phase-in period.<br> |
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<br>Indonesia, the world's most significant manufacturer and [exporter](https://www.abnnewswire.net/companies/en/31347/%E0%B8%9A%E0%B8%A3%E0%B8%B4%E0%B8%A9%E0%B8%B1%E0%B8%97-Mission-NewEnergy-%E0%B8%88%E0%B8%B3%E0%B8%81%E0%B8%B1%E0%B8%94.html/4) of palm oil, [prepares](https://www.proactiveinvestors.co.uk/companies/news/159352/mission-newenergy-debt-free-focused-on-biofuel-joint-venture-60797.html) to raise the [mandatory mix](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608) of palm oil in [biodiesel](https://www.zoominfo.com/c/mission-newenergy/346542889) to 40% - called B40 - from 35%, a policy that has actually activated a jump in palm futures and might pressure costs even more in 2025.<br> |
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<br>While the government of [President Prabowo](https://www.bloomberg.com/profile/company/MNELF:US) Subianto has said consistently the strategy is on track for full launch in the new year, market watchers say expenses and technical obstacles are most likely to lead to partial execution before complete adoption across the [sprawling island](https://www.sec.gov/Archives/edgar/data/1463471/000165495419013063/R31.htm) chain.<br> |
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<br>[Indonesia's](https://www.pinterest.com.au/missionnewenergy/) most significant fuel merchant, state-owned Pertamina, stated it needs to customize some of its fuel terminals to mix and store B40, which will be completed throughout a "shift period after government develops the required", spokesperson Fadjar Djoko Santoso told Reuters, without supplying details.<br> |
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<br>During a meeting with federal government officials and biodiesel producers recently, fuel merchants asked for a two-month shift duration, Ernest Gunawan, secretary general of [biofuel](https://stocktwits.com/symbol/MNEL) manufacturers association APROBI, who remained in participation, informed Reuters.<br> |
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<br>Hiswana Migas, the fuel sellers' association, did not immediately react to an ask for remark.<br> |
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<br>Energy ministry senior official Eniya Dewi told Reuters the required walking would not be executed slowly, and that [biodiesel](https://www.zoominfo.com/c/mission-newenergy/346542889) manufacturers are prepared to provide the higher mix.<br> |
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<br>"I have verified the preparedness with all producers recently," she said.<br> |
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<br>APROBI, whose members make fat methyl ester (FAME) from palm oil to be blended with diesel fuel, said the [federal government](https://www.investing.com/equities/mission-newenergy-ltd-company-profile) has not released [allotments](https://www.proactiveinvestors.co.uk/companies/news/159352/mission-newenergy-debt-free-focused-on-biofuel-joint-venture-60797.html) for [manufacturers](https://www.bloomberg.com/profile/company/MNELF:US) to sell to fuel merchants, which it normally has actually done by this time of the year.<br> |
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<br>"We can't perform without order files, and purchase order documents are obtained after we get agreements with fuel companies," Gunawan told Reuters. "Fuel companies can only sign agreements after the ministerial decree (on biodiesel allotments)."<br> |
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<br>The federal government prepares to designate 15.62 million kilolitres (4.13 billion gallons) of FAME for B40 in 2025, Eniya informed Reuters, less than its initial quote of 16 million kilolitres.<br> |
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<br>[FUNDING](https://stocktwits.com/symbol/MNEL) CHALLENGES<br> |
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<br>For the government, funding the greater blend might likewise be a difficulty as palm oil now costs around $400 per metric load more than petroleum. Indonesia utilizes profits from palm oil export levies, managed by a company called BPDPKS, to cover such spaces.<br> |
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<br>In November, [BPDPKS estimated](https://www.investing.com/equities/mission-newenergy-ltd-company-profile) it needed a 68% boost in aids to 47 trillion rupiah ($2.93 billion) next year and estimated levy collection at around 21 trillion rupiah, sustaining market speculation that a levy hike is impending.<br> |
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<br>However, the palm oil market would challenge a levy hike, [stated Tauhid](https://www.bloomberg.com/profile/company/MNELF:US) Ahmad, a senior expert with [think-tank](https://pitchbook.com/profiles/company/51278-86) INDEF, as it would injure the market, including palm [smallholders](https://www.pinterest.com.au/missionnewenergy/).<br> |
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<br>"I think there will be a delay, due to the fact that if it is implemented, the aid will increase. Where will (the cash) originate from?" he stated.<br> |
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<br>Nagaraj Meda, handling director of Transgraph Consulting, a commodity consultancy, stated B40 execution would be challenging in 2025.<br> |
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<br>"The application may be sluggish and progressive in 2025 and probably more busy in 2026," he said.<br> |
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<br>Prabowo, who took office in October, campaigned on a platform to raise the mandate further to B50 or B60 to attain energy self-sufficiency and cut $20 billion of [annual fuel](https://www.pinterest.com.au/missionnewenergy/) imports. ($1 = 16,035.0000 rupiah) (Reporting by Bernadette Christina |
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