Indonesia Raises January Biodiesel Subsidy Benchmark Price (HIP)

The Indonesian Ministry of Energy and Mineral Resources (ESDM) has set the January 2026 biodiesel Market Index Price (HIP) at IDR 13,631 per liter, excluding transportation costs. This figure does not represent a free-market trading price. Instead, HIP is a policy-based reference price used by the government to calculate subsidies under Indonesia’s mandatory biodiesel blending program.

The HIP serves as the settlement benchmark between biodiesel producers and fuel distributors, mainly Pertamina, to ensure the economic viability of blends such as B35 and future higher mandates. Transportation costs are calculated separately based on official ministerial regulations and vary by region.

While the CPO-to-biodiesel conversion price remains unchanged at USD 85 per tonne, the increase in HIP reflects adjustments related to exchange rates, energy price structures, and subsidy balancing mechanisms. In essence, HIP is a government compensation price, not a spot or commercial market price for biodiesel.