KUALA LUMPUR (March 8): Malaysia is expected to produce 1.5 million tonnes of biodiesel if the government’s B20 biodiesel mandate for the transport sector is fully implemented nationwide, said Malaysian Biodiesel Association (MBA) president UR Unnithan.

He added that figure could increase to 2.5 million tonnes if B30  comes into force by 2030, provided the new government is committed to enacting policies accommodative of the implementation.  

“When Malaysia announced B20, there was a lack of clarity because of the political situation. It is still uncertain. But definitely, Malaysia's volume is increasing, and I hope that B20 becomes a reality this year.

“It's a new government, and they are still setting policies in place. We (MBA) want to put forward [the] suggestion and hopefully it falls on the right ears... making the right kind of noises for the betterment of [the] Malaysian economy,” he said at the 34th Palm & Lauric Oils Price Outlook Conference & Exhibition (POC2023) on Wednesday (March 8).

The mandate to manufacture biofuel with a 20% palm oil component — known as B20 — for the transport sector was first rolled out in January 2020 but faced delays due to movement curbs imposed following the Covid-19 outbreak.

In 2021, the mandate was postponed to 2022 and subsequently to 2023 due to political uncertainties in the country that delayed policy making.

“If you look at the updated biodiesel data, 2022 has been the best year for Malaysian biodiesel both from production and consumption point of view, because post Covid-19, the consumption level started to rise. Some states in Malaysia already implemented B20 and consume nearly 1.1 million tonnes domestically,” he added.

Unnithan added the B20 mandate should not be just looked at as an additional market that will support palm oil prices, but also in terms of the climate change agenda, particularly with Malaysia’s aspiration to reduce greenhouse gas intensity by 35%.

Sarawak started the roll-out of B20 biodiesel in September 2020, while Labuan and Langkawi started their roll-out of B20 biodiesel in January 2020.