Indonesia considers new restrictions on palm oil exports amid rising demand for biodiesel

in the second half of 2026, will require diesel to be blended with 50% palm oil, up from the current 40% mandated by the B40. This shift is estimated to increase domestic palm oil demand by 5.3 million tonnes. To meet the increased demand, the government is considering a range of measures, including expanding oil palm plantations and introducing Domestic Market Obligations (DMOs), which require exporters to allocate a portion of their output for local consumption. Lahadalia emphasized that, while a final decision has not yet been made, export regulations remain a viable option to support the biodiesel initiative. Analysts warn that export restrictions could lead to a reduction in global supply and higher prices for edible oils, particularly in countries heavily dependent on Indonesian palm oil. The government’s discussions are taking place at a time when global food security and commodity prices are under close scrutiny. Analysts note that any measures to restrict palm oil exports ...