JAKARTA, July 24 (Reuters) - Indonesia, the world's greatest palm oil manufacturer, is testing fuel with a view to increasing to 40% from 35% the share of palm-oil mixed into biodiesel next year, the energy ministry stated.

If executed, the B40 mandate could increase biodiesel consumption to approximately 16 million kilolitres (KL) next year, the ministry said, from 13 million KL estimated to be consumed in 2024.

"We hope the trials might be completed in December, so that complete execution of B40 might be carried out in 2025," energy ministry senior main Eniya Listiani Dewi stated in a declaration on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) stated the industry had the capability to fulfill B40 demand, with set up capability expected to rise to 20 million KL annually next year from 18 million KL now.

"However we will require more basic materials to meet B40 demand," Ernest Gunawan, the secretary general of APROBI told Reuters on Wednesday.

The biodiesel industry would need 13.9 million metric lots of unrefined palm oil to 16 million KL biodiesel next year, from the estimated 11 million heaps needed this year, he added.

Indonesia's biggest palm oil association GAPKI said a decline in exports meant there would be adequate raw materials to provide the B40 required for now.

But the industry would require to evaluate "which one would be better", GAPKI chairman Eddy Martono stated, referring to the possibility a boost in exports would make providing the domestic market less feasible.

Indonesia's palm oil output is approximated to reach 54.4 million loads in 2024, a 2.26% increase from last year, while exports are expected to decline by 2.47% to 29.5 million tons as domestic intake rose, driven by biodiesel required.

The ministry had actually evaluated the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier today, while planning to check the B40 mix on farming equipment, power plants and in the shipping industry, it stated. (Reporting by Bernadette Christina and Dewi Kurniawati