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

If executed, the B40 mandate could increase biodiesel intake to as much as 16 million kilolitres (KL) next year, the ministry said, from 13 million KL approximated to be consumed in 2024.

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

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

"However we will require more raw products 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 crude palm oil to produce 16 million KL biodiesel next year, from the approximated 11 million tons needed this year, he included.

Indonesia's most significant palm oil association GAPKI stated a decrease in there would suffice raw products to provide the B40 required for now.

But the industry would require to examine "which one would be better", GAPKI chairman Eddy Martono stated, describing the possibility an increase in exports would make providing the domestic market less feasible.

Indonesia's palm oil output is approximated to reach 54.4 million lots in 2024, a 2.26% increase from in 2015, while exports are expected to decrease by 2.47% to 29.5 million tons as domestic intake rose, driven by biodiesel required.

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