Generic Hero BannerGeneric Hero Banner
Latest Market News

Indonesia may tighten POME oil export rules: Ministry

  • Spanish Market: Agriculture, Biofuels, Electricity, Emissions
  • 21/08/24

Indonesian exports of palm oil wastes and residues including palm oil mill effluent (Pome) oil may soon be subjected to stricter export regulations, according to a draft document from its trade ministry.

The ministry released the draft after a meeting with biofuel feedstock exporters on 20 August. The timeline for a decision on finalising the regulation is still unclear, although some market participants said it could be made by this month.

Exports of Pome oil, high acid palm oil residue (Hapor) and empty fruit bunches (EFB) oil under the HS code 2306.60.90 are expected to require export permits, a change from the previous requirement of only export rights. While more details were not disclosed, meeting domestic market obligations (DMO) is usually a prerequisite to get export permits, suppliers said. This means that companies will need to sell a certain amount of cooking oil within Indonesia — or buy export quotas or credits from palm oil refineries around $15-$20/t — before they are able to export these products. This has led to expectations of potentially tightened feedstock exports.

Refineries who sell cooking oil volumes to remote areas of Indonesia will also receive higher export quotas. As of January 2023, only crude palm oil (CPO), refined, bleached and deodorised (RBD) palm oil, RBD palm olein and used cooking oil (UCO) were subject to the DMO requirements.

The previously-set domestic Highest Retail Price (Harga Eceran Tertinggi or HET) for cooking oil sold to consumers at 14,000 rupiah/l is now Rp15,700/l. This is likely because of higher CPO prices and packaging costs, a Indonesia-based supplier said. But market participants said they were also anticipating this increase previously.

The higher HET implies that companies' cost of acquiring export permits in the medium to long term could fall, having sold cooking oil at higher prices domestically, market participants said.

DMO for cooking oil

Indonesia's Ministry of Trade also issued a regulation on 16 August stating that the DMO scheme for cooking oil will move fully from bulk to packaged palm olein – in 500ml, 1 litre (l), 2l and 5l volumes. This is likely to help maintain stable cooking oil prices and control inflation, as packaged olein is easier to monitor than bulk, a supplier said. The deadline for moving from bulk to packaged volumes is 12 November.

Refineries under the DMO must also supply cooking oil volumes domestically of around 250,000 t/month, compared with approximately 300,000 t/month previously. But actual volumes will also depend on factors like how much palm oil wastes and residues exporters want to ship in a particular month too, a supplier said.

The draft document did not include updates to long-awaited changes to export duties and levies to POME oil, UCO and other products, market participants said. They were expecting these changes in September or October when the new government is sworn in, although the actual timeline is difficult to determine. Current combined export duties and levies on POME for August is only $10/t, considering a CPO reference price of $820.11/t. UCO is not subject to duties, but have levies of $35/t.


Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

30/04/25

France to review role of renewables in energy plan

France to review role of renewables in energy plan

London, 30 April (Argus) — The French government will delay the publication of its 10-year energy plan (PPE), and could change its content to take into account criticism that it gives too much priority to renewables, after a debate in the French parliament earlier this week. Prime minister Francois Bayrou on 28 April held a parliamentary debate on the much-delayed plan, which was initially due to come out in 2023. Publication appeared imminent last month, but revolts in the parliament — in which the prime minister does not have a majority — have forced the government to reconsider. The government will take its decisions "in some months", Bayrou told the parliament. "This PPE is not written in advance and everyone will be able to contribute before the final version," he said, opening the door to a rewrite of the plan, which committed to large increases in wind and solar photovoltaic capacity. A commission will deliver a report at the end of May, to be followed by a parliamentary debate on a version of the plan authored by senator Daniel Gremillet in June. The government's support for renewable energy will be "reasoned", he said, suggesting there could be a scaling back of wind and solar ambition. Bayrou highlighted the problems of solar energy, including that its peak output does not correspond to peak demand periods. To solve this problem, France must make its demand more flexible — including through the upcoming reform of tariffs, which will offer lower prices to some customers in the middle of the day — and through developing storage, he said. But the question of cost remains. Roof-mounted installations in France — the sector which has advanced the fastest over the past year — produce at a cost of €100/MWh, he said, compared with €40/MWh at large ground-mounted plants in Spain. But the public acceptability of covering large areas of countryside with low-cost solar farms remains a question, he said. And the development of onshore wind must be "reasonable", as public acceptability of the technology diminishes as the number of installations increase, Bayrou said. France must focus on repowering existing sites, he added. And the government firmly supports extending the lifespan of existing nuclear plants, and building at least six more reactors to enter service from 2038, Bayrou said. Right-wing Rassemblement National (RN) called for an increase in nuclear ambition, demanding the construction of 10GW of new nuclear by 2035, upratings at existing reactors and increasing the load factor of the fleet to 80pc. This would put France on the road to increasing its energy mix to 60pc low carbon by then, up from 37pc now, RN deputy Maxime Amblard said. But this would be accompanied by a moratorium on intermittent renewables, especially on wind farms, he said. The centre-left socialists called for the publication of the PPE as is, while left-wing LFI and green parties criticised what they characterised as a lack of ambition on emissions reduction and too heavy a reliance on nuclear. By Rhys Talbot Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

China issues first export quota for SAF


30/04/25
30/04/25

China issues first export quota for SAF

Shanghai, 30 April (Argus) — Chinese biodiesel and sustainable aviation fuel (SAF) producer Jiaao Entrotech said today it has received government approval to export SAF from Lianyungang port. The producer has a quota to export 372,400t of SAF this year. It can export the SAF under the same harmonised system (HS) codes as conventional jet fuel, such as 27101911. The new SAF quota is an additional allocation and will not affect the volume of jet fuel export quotas that are regularly allocated to Chinese refiners. Jiaao's SAF plant is located at Guanyun in Lianyungang, a port in east China's Jiangsu province. The plant has 500,000 t/yr of operational capacity. This is the first time the Chinese government has issued an export quota for SAF. Other Chinese SAF producers in the government's approved list will also receive export quotas after further evaluation by Beijing, according to market participants. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Indonesia secures $60mn JETP funding for solar power


30/04/25
30/04/25

Indonesia secures $60mn JETP funding for solar power

Singapore, 30 April (Argus) — State-owned PLN Indonesia Power (PLN IP) and Saudi-listed Acwa Power will receive $60mn in funding from the Just Energy Transition Partnership (JETP) to develop a solar project in Indonesia, indicating there is still interest in financing the country's energy transition. The 92MW peak (MWp) Saguling floating solar project in west Java will receive the funds from German development finance institution DEG, French development finance institution Proparco and Standard Chartered bank, announced the Glasgow Financial Alliance for Net Zero (GFANZ) on 29 April. PLN IP and Acwa Power signed a power purchase agreement in August 2024 to jointly develop the solar project. The $60mn for the project is in addition to $1.2bn which Indonesia has already secured under the JETP. Indonesia joined the JETP in 2022 and is supposed to receive $20bn through the scheme from international partners including GFANZ, to help its coal phase-out. US president Donald Trump's decision to withdraw the US from the JETP raised concerns earlier in 2025 on whether Indonesia could stick to its energy transition policies. But the US' withdrawal may not necessarily have a major impact on JETP funding. The latest investment "points to appetite from both public and private sectors to finance the country's green energy transition," said GFANZ. France has already mobilised over €450mn ($511mn) for Indonesia's energy transition through the JETP, according to the ambassador of France to Indonesia, Fabien Penone. PLN IP, a sub-holding of state-owned electricity company PLN Persero, is the largest power generation company in southeast Asia. Indonesia's electricity demand is expected to grow by about 3.8pc/yr to 1,813TWh/yr by 2060, but its power sector is still heavily reliant on coal, which made up 61.8pc of the electricity mix in 2023. In comparison, renewables made up 19pc, out of which solar and wind power constituted a mere 0.2pc. Indonesia has large solar potential of up to 3,295GW, said PLN IP's president director Edwin Nugraha Putra. The Saguling solar project, which is expected to reduce carbon emissions in Indonesia's power system by at least 63,100 t/yr, will also increase the share of solar in Indonesia's electricity production by around 13pc, according to GFANZ. The share of renewables in Indonesia's power mix is expected to rise to around 21pc by 2030 and 41pc by 2040, according to think-tank Ember. By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

German participants argue against power zone split


29/04/25
29/04/25

German participants argue against power zone split

London, 29 April (Argus) — German power market participants have spoken out against dividing the German bidding zone, citing lower market liquidity and investments in renewable energies. The statements come after European transmission system operators (TSOs) association Entso-E yesterday published its bidding zone review (BZR), which concluded that splitting Germany's bidding zone into five would be the most "economically efficient". Germany's four TSOs argued that a bidding zone split would restrict liquidity in the futures market and could increase costs in the balancing market because fewer providers in smaller markets would participate. Renewables operators would probably see lower revenues, which could increase the need for subsidies, the TSOs said. And the economic gains from a split — around 1pc of system costs in 2025 — are not "meaningful". The TSOs also questioned the "suitability" of the study, citing "outdated" data and an "incoherent" analysis period. They highlighted the fact that the study compiled data from 2019, while the implementation of a split would only be possible by 2030, meaning developments in the system — including grid and renewables expansion — were not taken into account. Renewables association BEE agreed, adding that the BZR ignored several "key aspects", such as grid security, market efficiency, stability and the impact on the energy transition. The association highlighted the importance of strong German market liquidity, which enables "functioning" long-term power trading that is "crucial" for all of Europe. Traders' association Energy Traders Germany concurred, stating that a liquid market benefits consumers and businesses, as well as power plant investors. And exchange EEX told Argus that investments in power plants, which rely on "long-term framework conditions", would probably drop if the bidding zone were split. In the event of a split, subsidies and other compensation measures for industrial actors would probably need to be increased, EEX added. "All in all, it would end up being more expensive," the exchange told Argus . And chemical industry association VCI said reorganising the market would open up a "mega construction site" that would drag on for many years and create market uncertainty. A bidding zone split would make industrially strong regions into "high-price zones", energy association BDEW and automotive association VDA said, weakening competitiveness and prosperity. Instead of dividing the bidding zone, the focus should be on accelerated expansion and digitalisation of grids, they argued. The likely-incoming German government has pledged to stick to a single bidding zone , while economic ministry BMWK last year also rejected a bidding zone split , citing the complexity of the change, the risks to the competitiveness of industry centres, and lower liquidity. Germany's changing power system In the BZR, Entso-E advises assessing "the impact of the change of key influencing factors between 2025 and a potential implementation date around 2030", including grid expansion, before reconfiguring bidding zones. Germany's power mix in 2024 was much changed from 2019. In 2019, solar and wind output made up just under a third of the mix at an average of 19GW. By 2024, their share had risen to just under 46pc, with output averaging 23GW. And owing to the government-mandated phase-out, nuclear generation's share of the mix fell to zero by 2024 from just under 14pc in 2019, when Germany had 9.5GW installed nuclear capacity, according to Fraunhofer ISE data. Meanwhile, the share of coal and lignite-fired output dropped by around 2.6 and 3.9 respective percentage points from 2019 to 6.3pc and 16.3pc in 2024. Around 2.8GW and 10.3GW of coal and lignite-fired capacity, respectively, was taken off the open market in 2019-24 as part of the country's coal phase-out, according to data from grid regulator Bnetza. But gas burn in 2024 was around 1GW up from 2019, climbing to just over 12pc of the mix against 8.7pc five years earlier. And Germany's mix is likely to become even more renewables-heavy in the following years as it is set to phase out a further 6GW of dispatchable capacity by the start of 2030. The coal and lignite phase-out deadline is set for 2038, although market participants have recently called the date into question, owing largely to delays to the long-awaited power plant strategy. Owing to rapid solar buildout, solar generation in 2030 could average 16.2GW, according to Argus calculations. This would be 9.2GW up from 2024. And while onshore wind expansion lags in comparison, generation in 2030 could average 16.6GW, which would be around 4GW up from last year. German grid expansion is progressing rapidly, with 1,400km of power lines approved last year, a record. The four main projects aiming to address poor north-south interconnectivity — namely the 4GW Suedlink, 4GW Suedostlink, 2GW A-Nord and 2GW Ultranet lines — are set to come on line between the end of 2026 and 2030. German demand in 2024 was around 4GW lower than in 2019, largely owing to slowing production in energy-intensive industries, which has declined since December 2021. Recent US tariffs on imports have triggered further economic insecurity in industry, while BMWK earlier this month said it expects industrial activity in the coming months to "weaken". While economic growth is expected to increase by 1pc next year, according to BMWK, demand is unlikely to recover to pre-Covid and pre-energy crisis levels unless conditions improve for energy-intensive industries. By John Horstmann and Bea Leverett DE power mix 2019 % DE power mix 2024 % Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Trump return complicates climate talks: Cop 30 head


29/04/25
29/04/25

Trump return complicates climate talks: Cop 30 head

New York, 29 April (Argus) — This year's UN Cop 30 climate talks will proceed with a key goal of scaling up climate finance, but US president Donald Trump's disruptive return to the White House has made efforts to reduce emissions more challenging, according to the Brazilian official leading the summit. Continuing the fight to reduce greenhouse gas (GHG) emissions "is going to be a slightly uphill battle, but I think it's the right one," Brazil climate secretary and Cop 30 president André Corrêa Do Lago said Tuesday at the BNEF Summit in New York City. "The international context could help a little more", Corrêa Do Lago said, drawing laughter from the audience. Trump moved quickly after beginning his second term to withdraw the US from the Paris Agreement, an exit that will formally take effect in January 2026. He has started to impede US development of renewable energy projects he sees as boondoggles, but he is facing challenges to his attempts to halt government funding and tax credits for the sector. It is unclear if the US will send a delegation to the Cop 30 summit this year, which is scheduled to take place in Belem, Brazil, in November. Corrêa Do Lago said that invitations have not yet been sent to prospective participants. He also made a distinction between the US government and others in the US, including state and businesses leaders, that have pledged to continue supporting GHG emissions reductions even as the Trump administration moves to boost oil and gas. Publicly, countries have not changed their tune on climate in response to the US policy shifts. But Corrêa Do Lago said that privately there are "some that say, ‘God, how am I going to convince my people that I have to try to lower emissions if the richest country in the world is not doing the same?'" Corrêa Do Lago said that this year's summit needs to focus less on technical negotiations over documents that might never be implemented as a result, and more about making an economic appeal for decarbonization and hosting more of a "Cop of solutions, a Cop of action". He reiterated the Brazilian government's goal of increasing climate financing for developing countries from the target set at Cop 29 of $300bn/yr by 2035 to the far higher target of $1.3 trillion/yr. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Generic Hero Banner

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more