MALAYSIA must compete more aggressively in the biodiesel sector or be left behind by fellow palm oil producers Indonesia, who have already declared the mandatory use of a 20% biodiesel blend (B20) in September this year, said prime minister Dr Mahathir Mohamad.

Dr Mahathir said not only has Indonesia surpassed Malaysia and emerged as the largest producer of palm oil in the world, the republic has implemented the B20 programme, which makes it mandatory for the transport sector to use a blend of 20% of palm oil with 80% diesel fossil fuel.

“Malaysia’s palm oil industry should dare to venture into new markets and prove to the world that Malaysia’s palm oil quality is among the best,” he said at the launch of the B10 Diesel programme at Putrajaya today.

He said all industry players and the biodiesel sector in Malaysia will be able to achieve the B20 biodiesel by 2020.

Dr Mahathir said the B10 biodiesel programme (10% palm methyl ester with 90% petroleum diesel) is to progressively replace the B7 programme (7% palm methyl ester with 93% petroleum diesel) by February 2019.

Petroleum companies have two months to switch from the current B7 to B10 biodiesel before its mandatory implementation on Feb 1, 2019.

Dr Mahathir said the he expects the biodiesel programme to be taken seriously in the National Automotive Policy (NAP), which is being drafted by the International Trade and Industry Ministry.

“I urge that vehicle manufacturers and OEMs (or original equipment manufacturers) work with the government to ensure the implementation of this B10 programmes including any biodiesel programmes in the future.

“Malaysia needs to increase its higher rate of return in the future to strengthen the domestic demand of palm oil.”

Dr Mahathir hopes that all parties will be fully prepared to change to B20 by 2020.

“This biodiesel programme is very important for the country as palm trees are the golden crop of the country, and have been generating income for the  country’s economy for a long time.

“The use of palm biodiesel will have a positive impact in the palm industry by reducing palm oil stocks and further stabilising palm oil prices.”

Dr Mahathir said through this effort, 650,000 smallholders of palm oil will continue to enjoy a more stable palm price and increase in revenue.

“The country’s biodiesel programme will also help the country achieve its objectives in low-carbon mobility as outlined in the half-term review of the 11th Malaysia Plan (RMK11).”  – December 11, 2018.