Kuala lumpur: The increase in the biodiesel mandate from B10 (10 per cent palm-oil-based biodiesel) to B15 will reduce the country's reliance on export markets, said Federal Land Development Authority (Felda) chairman Datuk Seri Ahmad Shabery Cheek. He said the higher mandate would also encourage industry players to increase biodiesel production capacity, helping maintain palm oil price stability in the future by increasing domestic demand.

According to BERNAMA News Agency, Ahmad Shabery stated that while export markets are beneficial for earning foreign exchange, they often come with conditions, quotas, or taxes. He emphasized that domestic use of palm oil would benefit the local plantation industry and protect settlers' incomes. Malaysia currently has 20 biodiesel plants with the capacity to support up to a 30 per cent biodiesel blend, yet most are operating below capacity due to limited demand, which is currently set at B10 at petrol stations and B7 in certain industrial sectors.

Ahmad Shabery's comments followed a memorandum of understanding (MoU) signing between Felda and Encorp Bhd for the Felda Staff housing project. He highlighted that the implementation of the new B15 mandate, effective from June 1, is expected to boost the country's biodiesel usage and allow production plants to increase their utilisation rates.

He further explained that Malaysia has the potential to enhance biodiesel use given its production capacity. The use of palm oil for biodiesel could rise to about five to six million tonnes annually without impacting domestic needs, thus decreasing reliance on export markets. Malaysia produces approximately 20 million tonnes of palm oil every year, with three million tonnes used for food products and one million tonnes for biodiesel, leaving about 15 to 16 million tonnes for export.