Indonesian Government Adjusts Biofuel Prices for January 2026

New Pricing for Biodiesel and Bioethanol

The Indonesian Ministry of Energy and Mineral Resources (ESDM) has announced an increase in the market index price (HIP) for both biodiesel and bioethanol effective January 1, 2026. The new prices are set at Rp 13,631 per liter for biodiesel and Rp 8,438 per liter for bioethanol ¹

Factors Influencing the Price Adjustment

The price increase for biodiesel is primarily attributed to the global crude palm oil (CPO) price movements. The calculation formula, as per the Minister of ESDM's decision, includes: HIP = (average CPO price at KPB + US$ 85/ton) × 870 kg/m³ + transportation cost ³

Regulatory Framework

The price adjustments are made in accordance with the Fifth Dictum of the Minister of ESDM's Decision No. 6034K/12/MEM/2016 regarding the Market Index Price of Biofuels blended into petroleum-based fuels. The bioethanol price calculation uses a formula based on the average sugarcane price over three months, with additional fixed components ²

Implications for the Biofuel Sector

These price adjustments reflect the government's efforts to maintain the stability of the biofuel supply while considering global market fluctuations. The increase in biodiesel price to Rp 13,631 per liter from Rp 13,381 per liter in December 2025 represents a moderate rise, potentially impacting fuel blending costs for companies in the energy sector ¹