23/10/2008 (Bernama), Jakarta - Most Indonesian palm oil producers are ready to utilise biodiesel fuel, to increase the use of crude palm oil, as the price of the commodity in the world market has dropped.

"After inspecting a number of regions including Riau, I concluded that many palm oil factories were ready to use biodiesel," the executive chairman of the Association of Indonesian Palm Oil Producers (GAPKI), Derom Bangun, said.

He made the statement in reaction to a number of economists who considered the call to use vegetable oil fuels in palm oil factories as an additional burden.

He said the use of biodiesel was posssible because many palm oil factories had the equipment for it.

"Biodiesel can be used by mixing it with diesel to activate turbines in the factory. New equipment is not needed," Derom bangun was quoted as having said by the Antara News Agency in Pekan Baru, Riau.

He said the use of biodiesel in palm oil factories could reduce around five percent of the industrial diesel need, which reaches 27 million tonnes a year.

The use of biodiesel in palm oil factories could increase domestic use of palm oil up to 1.35 million tonnes a year, he explained.

In view of that, he said crude palm oil use in the country would rise to 4.5 million tonnes out of this year's production of between 18.8 to 19 million tonnes.

He said the rise in the use of crude palm oil in the country may help reduce the impact of declining exports as a result of the current global economic crisis.