This article first appeared in The Edge Financial Daily on July 19, 2018

KUALA LUMPUR: The federal government is mulling the B10 biodiesel blend implementation in the second half of 2019 (2H19), according to Nikkei Markets.

Quoting Deputy Primary Industries Minister Shamsul Iskandar Md Akin, the news wire reported yesterday that the ministry is in discussions with industry stakeholders including vehicle manufacturers.

“We are still working towards B10 because we have a lot of stockpile to clear and want to increase the price [of palm oil]. We must have warranty from car manufacturers that this B10 diesel is alright to be used for cars,” he reportedly said. Currently, the country has a B7 mandate, consisting 7% palm oil and 93% diesel.

In March, theedgemarkets.com reported that Malaysian Biodiesel Association president UR Unnithan said Malaysia could see its current B7 biodiesel mandate rise to 10% for the transportation sector after the 14th general election, as the implementation requires political will.

Unnithan, Sumwin Solutions Malaysia Sdn Bhd founder and group chief executive officer, said the mandate would create better demand and floor price for crude palm oil (CPO).

The B10 programme was launched in 2013 to increase palm oil consumption as the commodity price faced downward pressure due to increasing inventory.

However, the programme was deferred multiple times due to concerns over the potential damage to vehicles’ engines, which may not fall under manufacturers’ warranty although this was disputed by biodiesel producers.

The B5 programme only began on June 1, 2011 although the initial roll-out was planned for 2008.