THE government’s move to implement the B15 biodiesel mandate from 1 June will not affect the country’s palm oil export commitments, according to Plantation and Commodities Minister Datuk Seri Noraini Ahmad, who said domestic supply levels remained more than adequate to support the policy shift.
The Government’s decision to increase the biodiesel blend from B10 to B15 forms part of a broader strategy to strengthen national energy security, reduce reliance on imported fossil fuels and accelerate the transition towards renewable energy sources following instability in West Asia.
Noraini said Malaysia currently produces approximately 20 million metric tonnes of palm oil annually, with around 16 million metric tonnes exported overseas.
She explained that the remaining four million metric tonnes allocated for domestic consumption would be sufficient to support the implementation of the B15 programme without reducing export volumes.
“From the four million metric tonnes, only about 0.8 million metric tonnes are required for B15 usage, meaning we will not disrupt export volumes to overseas markets.
“We have conducted a detailed analysis on this matter and after discussions with industry players, they believe B15 is the right figure without requiring upgrades to existing facilities,” she said after a media briefing on the B15 Biodiesel Implementation.
The Cabinet and the National Economic Action Council previously approved the increase in biodiesel blending rates from B10 to B15 beginning with B12 on 1 June, partly in response to fuel supply concerns linked to geopolitical tensions in the Middle East.
The move is intended to reduce excessive dependence on imported fossil fuels and volatile international energy markets while supporting Malaysia’s low-carbon transition agenda.
Noraini said Malaysia currently operates under the B10 biodiesel mandate for the transport sector, while the shift towards B15 was implemented under Government policy decisions.
When asked whether Malaysia would eventually move towards B20 biodiesel nationwide, she revealed that the Government had already approved RM40 million under the first phase of infrastructure upgrades in Sarawak.
“We are now submitting requests to the Ministry of Finance for increased allocations under the second phase to upgrade facilities.
“We are focusing particularly on the Klang Valley Distribution Terminal (KVDT) as one of the facilities we intend to upgrade if the allocation is approved,” she said.
Under the B15 mandate, diesel fuel will contain 15 per cent palm-based biodiesel and 85 per cent petroleum diesel.
Malaysia first introduced its National Biodiesel Programme in 2011 through the B5 mandate for the transport sector before gradually expanding the programme to B7 in 2014 and subsequently to B10 and B20 between 2019 and 2020.
Under existing arrangements, B10 contains 10 per cent Palm Methyl Ester (PME) and 90 per cent petroleum diesel, while B20 consists of 20 per cent PME and 80 per cent petroleum diesel.
For the industrial sector, the B7 blend remains in use, comprising seven per cent PME and 93 per cent petroleum diesel.
The Government is now targeting nationwide implementation of the B30 mandate for land transportation by 2030 in line with the National Agricommodity Policy, National Energy Policy and Malaysia’s broader energy transition and low-carbon development goals.
Officials estimate that domestic crude palm oil consumption will rise significantly under the expanded biodiesel programme, with annual demand projected to increase to 0.801 million metric tonnes under B15 compared with 0.534 million metric tonnes under the current B10 mandate.
Under a future B20 rollout, annual crude palm oil usage could reach approximately 1.068 million metric tonnes, a move expected to strengthen domestic demand and support incomes among smallholders and players across Malaysia’s palm oil industry. - May 25, 2026
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