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Farmers

Indonesia to Mandate 10 Percent Ethanol Blend in Gasoline by 2026

Strategic Insights

— 1 min read

Indonesia is set to become the first country in Southeast Asia to mandate a 10 percent ethanol blend in gasoline, a move expected to benefit farmers and reduce the country's dependence on fuel imports. Coordinating Minister for Food Zulkifli Hasan stated that the new policy will increase the price of cassava, a key raw material used to produce ethanol, to Rp2,000 per kilogram, up from the current price of Rp1,350. The policy is also expected to promote the use of cleaner and more environmentally friendly gasoline.

Key Takeaways:

  • The Indonesian government has set a target to blend 10 percent ethanol into gasoline by 2026, which is expected to benefit farmers who will see an increase in the price of cassava and sugarcane.
  • The price of cassava is expected to rise to Rp2,000 per kilogram from the current price of Rp1,350 per kilogram.
  • The mandatory 10 percent ethanol blend is expected to drive the country's economy, as the raw materials used are locally sourced.
  • Energy and Mineral Resources Minister Bahlil Lahadalia emphasized that the policy aims to reduce dependence on fuel imports and promote the use of cleaner and more environmentally friendly gasoline.
  • A member of the House of Representatives (DPR RI) has warned that the government must ensure that domestic ethanol production capacity can meet national demand before implementing the policy.
  • President Prabowo Subianto has approved the plan to mandate a 10 percent ethanol blend in gasoline.

Statistics:

  • The price of cassava is expected to rise to Rp2,000 per kilogram.
  • The current price of cassava is Rp1,350 per kilogram.
  • The Indonesian government aims to blend 10 percent ethanol into gasoline by 2026.
  • 2026 is the target deadline for implementing the 10 percent ethanol blend policy.

Sources:

  • Coordinating Minister for Food Zulkifli Hasan, "Gov't to Benefit Farmers with Mandatory 10 Percent Ethanol Blend".
  • Energy and Mineral Resources Minister Bahlil Lahadalia, "Gov't Plans to Mandate 10 Percent Ethanol Blend in Gasoline".
  • Commission XII of the House of Representatives (DPR RI) member Ratna Juwita Sari, "Gov't Must Ensure Domestic Ethanol Capacity".
  • President Prabowo Subianto, "President Approves Plan to Mandate 10 Percent Ethanol Blend in Gasoline".

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