Jakarta. Indonesia's success in turning crude palm oil into high-quality biofuel has stirred a hornet’s nest in the European Union market.

Indonesia, along with other palm-oil producing countries, have long argued that the EU ban on crude palm oil (CPO) is discriminatory and was only issued to create more space for rapeseed oil produced by EU member countries.

According to Ngurah Makertiharta, a chemical reactions and catalysts specialist from Bandung Institute of Technology (ITB), the EU is now worried that their plan to discriminate CPO "for environmental reasons" will fail.

"They have been worried ever since we found ways to turn CPO into biofuel that we can use for ourselves," Ngurah said. 

The academic was part of a research team that discovered a method to process CPO into biofuel.

Ngurah and his team from the Chemical Reaction and Catalyst Technical Laboratory in ITB announced the discovery of a new technique to turn CPO into biofuel using a catalyst on May 1.

The research was conducted to solve the problem of surplus CPO in Indonesia, which was partly caused by EU's refusal to buy palm oil from Indonesia.

Indonesia is the world's largest producer of palm oil, churning out 46 million tons of the versatile product per year, though only 3 million tons of it can be converted into palm kernel oil (PKO).

This was the reason why the government and a few private companies decided to fund the ITB research to develop new palm oil derivatives.

Ngurah said a similar innovation was discovered by European scientists based in Singapore, who used Indonesian palm oil to produce drop-in diesel.

The ITB professor said palm oil price will increase if biofuel made from palm oil can be produced on a large scale. This will mean bigger profits for palm oil producers, including farmers.