LUBBOCK, TX – Indonesia could emerge as a significant new market for U.S. ethanol if its new blending roadmap and trade agreement are fully implemented. USDA says Indonesia and the United States agreed in February to eliminate ethanol tariffs and remove barriers to U.S. imports, although formal implementation was still pending in July.
Indonesia has a gasoline market of roughly 9.8 billion gallons annually, but USDA forecasts only about 396,000 gallons of fuel ethanol consumption in 2026. The government plans to expand from E5 toward E10, creating substantial potential demand.
At E5, that gasoline pool could require roughly 489 million gallons of ethanol, equivalent to about 175 million bushels of corn at 2.8 gallons per bushel. E10 would roughly double that potential.
Domestic supply remains limited. USDA forecasts Indonesian fuel ethanol production at only about 423,000 gallons this year, while the government targets roughly 317 million gallons of sugarcane ethanol production by 2030.
Indonesia still prioritizes domestic biofuels, making implementation and import rules critical. But the gap between current production and future blending needs creates a potentially valuable opening for U.S. ethanol exporters.
Farm-Level Takeaway: Indonesia’s ethanol expansion could create meaningful new demand for corn if U.S. exporters gain sustained access to the market.