InfoSAWIT, JAKARTA – The Indonesian government has increased the Market Index Price (HIP) for biodiesel to Rp14,643 per liter, excluding transportation costs, effective June 1, 2026, reflecting higher crude palm oil (CPO) prices and supporting the continuation of the country’s biodiesel blending mandate.
The new pricing was established by the Directorate General of New, Renewable Energy and Energy Conservation (EBTKE) under the Ministry of Energy and Mineral Resources as part of the implementation of Indonesia’s mandatory biodiesel program.
According to an official letter signed by Director General Eniya Listiani Dewi, the conversion value of crude palm oil into biodiesel was set at US$85 per metric ton.
Information obtained by InfoSAWIT from EBTKE shows that the June 2026 biodiesel price was calculated using the average CPO price recorded between April 25 and May 24, 2026, combined with conversion factors and transportation cost components stipulated under existing regulations.
The calculation appendix published by EBTKE indicated that the average CPO price in the KPB market during the reference period reached Rp15,348 per kilogram, serving as the primary basis for determining the June biodiesel index price.
In addition, the formula incorporated the average Bank Indonesia middle exchange rate between April 25 and May 24, 2026, which stood at Rp17,444 per US dollar. Currency movements remain a key component in calculating the conversion value of palm oil feedstock into biodiesel.
The biodiesel market index price plays a critical role in ensuring the sustainability of Indonesia’s renewable energy strategy, particularly the expansion of palm oil-based biofuels.
The policy has become one of the government’s key instruments for boosting domestic palm oil consumption, reducing dependence on imported fossil fuels, and strengthening national energy security.
With the new HIP set at Rp14,643 per liter plus transportation costs, biofuel producers are expected to maintain adequate biodiesel supplies to support Indonesia’s expanding mandatory biodiesel blending program. (T2)
