Local biodiesel plants may support B7 blend–report

The country’s biodiesel output could expand to 370 million liters this year as the spike in demand spurred the entry of new players into the industry, an international agency said.

In its latest report, the United States Department of Agriculture (USDA) said it expects the Philippines to produce 370 million liters of biodiesel in 2026, up 6 percent from its revised output of 348 million liters last year.

“This growth is supported by rising consumption under the current B3 mandate, and the increase in the number of biodiesel producers from 13 in 2025 to 15 this year.”

The agency noted that current biodiesel plants could support up to a 7-percent coco-methyl ester (CME) biodiesel blend or B7, which means the country could accommodate the implementation of the B5 blend.

“Industry contacts also note that while the bulk of coconut oil continues to flow to traditional export markets, the local biodiesel industry offers coconut farmers a more predictable market,” the USDA said.

This advantage would become more pronounced with the implementation of higher blend mandates, it added.

As of April, the USDA said 15 accredited biodiesel producers operate in the Philippines with combined installed capacity of 907 million liters per year (MLPY).

One facility has been non-operational since 2025 due to expired accreditation, reducing total capacity to 883 MLPY, it added.

Three facilities, however, have received accreditation for construction, with a combined potential capacity of 201 MLPY.

The latest overcapacity relative to the B3 mandate reflects industry expansion undertaken in anticipation of a shift to B5, as guided by the Philippine Energy Plan (PEP), the USDA said.

“Raising the biodiesel blend mandate would require sustained development of domestic feedstock sources to ensure adequate supply.”

Currently, the blend remains at B3 following a Department of Energy (DOE) advisory issued last year that suspended the scheduled hikes in biodiesel mandates to B4 (October 2025) and B5 (October 2026).

This was after international quotations for coconut oil skyrocketed last year due to a global supply crunch, which could put pressure on pump prices.

Last month, the Department of Agriculture (DA) endorsed a resolution seeking the implementation of the B5 blend, with the proposal forwarded to the Senate and DOE for consideration.

The move follows a resolution, approved by the Philippine Council for Agriculture and Fisheries’s (PCAF) National Sectoral Committee on Coconut, which called for the higher use of CME in diesel fuel.

Under the Biofuels Act of 2006 or Republic Act 9367, all liquid fuels for motors and engines sold in the country should be blended with biofuels.