JAKARTA: Indonesia’s palm oil export growth slowed in the first half of 2026 as the country prepared for the rollout of its B50 biodiesel mandate, which is expected to increase domestic consumption and reduce exportable supplies.
Data released by Statistics Indonesia (BPS) showed palm oil exports rose 7.3 per cent year-on-year to $12.27 billion during January-June 2026, compared with $11.43 billion in the same period last year. The growth was significantly lower than the 24.8 per cent increase recorded in the first half of 2025, JakartaGlobe.ID reported.
Export volumes increased 2.5 per cent to 11.28 million tonnes during the six-month period. However, crude palm oil exports in June declined 0.4 per cent year-on-year to $393.7 million, while shipment volumes fell nearly 20 per cent to 335,400 tonnes.
BPS Deputy Ateng Hartono said the latest export figures did not yet reflect the impact of the B50 biodiesel programme, which came into effect in July after Indonesia raised the mandatory palm oil blend in biodiesel from 40 per cent to 50 per cent.
He said the effect of the policy on exports would become clearer in the coming months as it would depend on factors including production, supply, domestic demand and international prices.
The Indonesian Palm Oil Association (Gapki) has estimated that the B50 programme will increase domestic crude palm oil demand by about 1.9 million tonnes, with total consumption for the biodiesel programme expected to reach around 14.6 million tonnes.
Gapki has warned that exports could decline significantly if palm oil production does not increase enough to meet the additional domestic demand created by the B50 mandate.
The government has introduced the B50 programme as part of its strategy to reduce dependence on imported fossil fuels. Indonesia’s oil and gas imports more than doubled year-on-year in June 2026, driven by higher energy imports from Singapore and Malaysia.
Indonesia is the world’s largest producer and exporter of palm oil, which is widely used in food products, personal care items and biofuels.
