Evaluating the palm oil demand in Indonesia: production trends, yields, and emerging issues

Figures & data

Figure 1. Volume of crude palm oil (CPO) feedstock for export, biodiesel production, food use and other industrial domestic uses in Mtonne (left axis), and CPO yield development in tonne per ha (right axis) in Indonesia, 2009–2014.

Figure 2. Crude palm oil (CPO) and biodiesel production system with domestic uses and export. Numbers in parentheses refer to the production and use in 2014.

Figure 3. Projected diesel demand in Indonesia, expressed in volume of the energy carrier (left axis) and total energy (right axis).

Table 1. Fuel volume, feedstock mass and area requirements for achieving Indonesian biodiesel blending targets according to Indonesia Regulation 12/2015.

	2015 (15% blend)	2016 (20% blend)	2020 (30% blend)	2025 (30% blend)
bL	4.3	5.5	9.4	12.2
Mtonne^a	3.9	5.0	8.6	11.2
Mha^b	1.3	1.7	2.8	3.7

^aCPO to biodiesel conversion: 1.042 kg/kg.

^bArea requirement based on a yield of 3.8 tonne/ha, and 80% harvested area of the total area.

Source: Authors’ projection of 5.4% annual increase in diesel energy demand, based on projections by USDA and BPPT [3,40].

Table 2. Projections of future demand for Indonesian crude palm oil (CPO, Mtonne).

Demand	2015	2016	2020	2025
Food^a	5.6	5.8	6.3	6.9
Industrial
Biodiesel^b	3.9	5.0	8.6	11.2
Other^c	1.2	1.3	1.6	2.0
Export^d	23.7	24.5	27.4	31.0

^aFood use based on 1.1% annual increase per capita [34,41].

^bAuthors’ projection of 5.4% annual increase in diesel energy demand to meet blending targets as stipulated by Indonesia Regulation 12/2015; based on projections by USDA and BPPT [3,40].

^cOther industrial non-food use based on a yearly increase of 5.1% [42].

^dExport demand based on Indonesia providing 37% of exported vegetable oil in 2024 [34].

Table 3. Palm oil yields for analysis of land requirements (tonne/ha).

Yield	2015	2020	2025	Description
No yield improvement	3.8	3.8	3.8	Average yield in tonne/ha 2012–2014.^a
Medium yield improvement	3.8	4.1	4.4	Increase equal to past trends, 3.8–4.4 tonne/ha 2015–2025 and 3% per annum.^b
High yield improvement	3.9	5.0	6.0	A linear increase to the potential yield in Indonesia of 6 tonne/ha.^c

Sources:

^a[53].

^bLinear extrapolation from past trend of 2006–2014 [48].

^cPotential yield of 6 tonne/ha for Indonesia [13,22,50,52].

Figure 4. Crude palm oil (CPO) required for domestic uses only.

Figure 5. Plantation area needed to supply domestic crude palm oil (CPO) demand.

Figure 6. Crude palm oil (CPO) required for domestic and export demand.

Figure 7. Plantation area needed for domestic and export crude palm oil (CPO) demand.

Table A1. Future projections of Indonesian total diesel-type energy demand, expressed in billion liters of fossil diesel energy equivalents.

Source	2015	2016	2020	2025
Authors’ projection	32.6	32.4	40.0	52.0
United States Department of Agriculture (USDA) 2015	32.6	32.4	39.4	49.2
BPPT (high GDP growth)	30.9	–	42.7	60.4
BPPT (business as usual)	30.3	–	39.4	52.0

Note: BPPT diesel demand is projected from a smaller initial diesel use in 2014.

Source: Authors’ projection; Indonesian authorities [3,40].

BPPT: Agency for the Assessment and Application of Technology (Badan Pengkajian dan Penerapan Teknologi in Bahasa)

Table A2. Data used for calculation of energy demand and crude palm oil (CPO) conversion into palm oil biodiesel.

Particulars		Value	unit
Fossil diesel	Energy content	35.8	MJ/L
	Mass density	0.832	kg/L
Biodiesel	Energy content	33.0	MJ/L
	Mass density	0.875	kg/L
CPO^a	CPO per unit of Biodiesel	1.042	kg/kg

^aBased on average [45–47].

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