JAKARTA, July 24 (Reuters) - Indonesia, the world's most significant palm oil producer, is evaluating 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 carried out, the B40 mandate might increase biodiesel consumption to up to 16 million kilolitres (KL) next year, the ministry said, from 13 million KL approximated to be consumed in 2024.

"We hope the trials could be finished in December, so that complete application of B40 could be performed in 2025," energy ministry senior official Eniya Listiani Dewi said in a statement on Tuesday.

The Indonesian Biofuel Producers Association (APROBI) said the market had the capacity to meet B40 need, with set up capacity anticipated to increase to 20 million KL every year next year from 18 million KL now.

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

The biodiesel market would require 13.9 million metric lots of unrefined palm oil to produce 16 million KL biodiesel next year, from the estimated 11 million lots required this year, he included.

Indonesia's biggest palm oil association GAPKI stated a decline in exports suggested there would be enough raw materials to provide the B40 mandate in the meantime.

But the market would require to examine "which one would be better", GAPKI chairman Eddy Martono said, describing the possibility a boost in exports would make supplying the domestic market less practical.

Indonesia's palm oil output is estimated to reach 54.4 million lots in 2024, a 2.26% increase from last year, while exports are expected to decrease by 2.47% to 29.5 million tons as domestic consumption increased, driven by biodiesel mandate.

The ministry had actually tested the biodiesel, blended with 40% of palm oil, on a train for the very first time earlier this week, while preparing to check the B40 mix on farming equipment, power plants and in the shipping industry, it said. (Reporting by Bernadette Christina and Dewi Kurniawati; Writing by Stanley Widianto; Editing by John Mair, Savio D'Souza and Barbara Lewis)