At IPOC 2026, Airlangga Pushes Palm Downstreaming into Biodiesel and SAF

Nusa Dua — The government is steering palm oil downstreaming toward biodiesel and sustainable aviation fuel (SAF) to strengthen energy security, Coordinating Minister for Economic Affairs Airlangga Hartarto said while opening the 22nd Indonesian Palm Oil Conference and 2027 Price Outlook (IPOC 2026) virtually from Nusa Dua, Bali, on Thursday (12/11).

In his keynote, Airlangga said the B50 biodiesel mandate that began in July 2026 is an example of downstreaming being pushed forward. The biodiesel requirement is projected to rise from 15.6 million kilolitres (kL) under B40 to about 16.7 million kL under B50, cutting greenhouse gas emissions by about 44.46 million tonnes of CO2 equivalent.

Biodiesel and SAF at the centre of downstreaming

Alongside biodiesel, the government is exploring SAF development as part of a broader energy transition agenda. Airlangga stressed the strengthening of the Indonesian Sustainable Palm Oil (ISPO) certification and the development of the ISPO Information System to integrate plantation certification data with supply chain information, as a foundation for downstream industry.

"The step is important not only for sustainability and meeting market requirements, but also as a strong foundation for downstream industry," Airlangga said in a keynote delivered virtually because he could not attend in person.

Export and production performance

According to Airlangga, the plantation subsector contributed 5.15% of national gross domestic product (GDP) in the third quarter of 2026, with palm oil the largest contributor. Palm oil export value in January–October 2026 reached US$28.84 billion, up 60% year on year, on volume of 33.8 million tonnes, up 6%.

Crude palm oil (CPO) production rose from 52.76 million tonnes to 56.55 million tonnes in 2025. For 2026, total palm oil output is projected at about 60 million tonnes, with domestic consumption of about 27.89 million tonnes and exports of about 35 million tonnes. Airlangga also cited palm oil productivity of about 4 tonnes per hectare, far above sunflower, rapeseed and soybean at less than 0.7 tonnes per hectare.

Smallholder support and collaboration

To ensure smallholders share the benefits, the government is running the smallholder replanting programme (PSR), plantation support facilities, and human-resource development through scholarships and technical training — aimed at lifting productivity without expanding acreage. The opening of IPOC 2026 was also attended by National Development Planning Minister Rachmat Pambudy, Deputy Foreign Minister Arif Havas Oegroseno and GAPKI Chairman Eddy Martono.

"With collaboration and shared commitment, Indonesia's palm oil industry is believed to keep contributing positively to global food security, become a pillar of energy security, and serve as a source of sustainable economic resilience," Airlangga said.