Tuesday, April 7, 2009

[PBN] Southeast Asia, bio-diesel industry in trouble

From: Anrosoft - 29/03/2009
In China and India increase demand for food, palm oil, etc. This has led to bio-diesel prices of major raw materials in Southeast Asia to build multi-billion dollar investment in biodiesel plants in some plans have been shelved.

Asian manufacturers said that because the United States has been heavily subsidized biodiesel exports excess supply of biofuels in Europe, combined with oil palm cultivation in the West more and more worried about the negative impact on the environment, making the project even more bleak the prospects.

This is the fate of bio-diesel industry turning point in the accident. Just over a year ago, some Asian companies also competing bio-diesel plant set up to take advantage of Europe and the United States to promote cleaner fuel consumption and provide subsidies.

It is predicted that the construction or planning of the project can be put into operation an annual output of 5,000,000 tons of biodiesel, equivalent to Europe in 2007 about half of capacity. The Government of Indonesia announced that the country only on the plans to invest 12.5 billion U.S. dollars for a new bio-diesel project.

Vegetable oil extracted from bio-diesel mixed with conventional diesel use, the current European and American stations have to sell the fuel. In theory, such an increase of vehicle fuel consumption by gasoline or conventional diesel mileage driven, thereby reducing greenhouse gas emissions.

Crude oil prices start rising last year, the investment in bio-diesel plant spending plans seem a bit meaningless. However, palm oil produced in Southeast Asia prices rise, so that the use of palm oil as raw materials to sustain the bio-diesel plant.

At the same time, the world’s consumption of biodiesel in the European Union to tighten up to the subsidy scheme, the recent destruction of natural forests and plant oil palm for biodiesel production excluded. Recent research found that deforestation for oil palm cultivation even though the practice is usually illegal, but very common in Indonesia and other countries, this approach will be released into the atmosphere large amounts of greenhouse gases, cleaner fuels to offset brought to benefits.

Asian biofuel production also complained that the United States exporters to the European biofuels market dumping prices than Asian manufacturers as much as 30% lower. United States manufacturers to extract from the soybean-based biodiesel, available to one U.S. dollars per gallon tax rebate, and then exports to Europe, but also bio-diesel from Europe to the benefit of subsidies. Last week, a European federation of bio-diesel manufacturers to the European Commission (European Commission) make a formal complaint, saying that the United States bio-diesel export subsidies constitute unfair competition.

The result of the above are a number of Asian palm oil producers canceled the construction of bio-diesel plants, only a small number of new plant put into operation. Malaysia as an example, the country’s commodities minister Peter Chin said last week, last year Malaysia produced only 80,000 tons bio-diesel, which is well below one million tons of annual capacity.

Singapore oil palm plantation owner Wilmar International Ltd of the Au Kah Soon spokesman said: “At the current high palm oil prices, the palm biodiesel difficult to maintain.” Last year, Wilmar at the Indonesian island of Sumatra in Southeast Asia into the largest bio-diesel plant. But the annual production capacity of up to one million tons of bio-diesel plant open for just over a contract to meet the needs of the current production capacity. Soon, said: “We expect this year there is only a small fraction of the income from the bio-diesel.”

Indonesian palm oil company Sinar Mas Agro Resources & Technology Ltd.’s Spokesman said the company also suspended with the China National Offshore Oil Corporation (China National Offshore Oil Corp.) Joint venture in Indonesia’s remote Papua province to invest 5.5 billion U.S. dollars to build large-scale biology diesel plants. The scheme was originally intended to be one million hectares of forests for oil palm plantation development, environmentalists angry this great add.

Do not have their own oil palm plantation of bio-diesel manufacturers affected the most, because they must pay a higher price of raw materials. Malaysia Derivatives Exchange of the hair in 2007 following the palm oil futures rose 50 percent after this year also rose 12%.

Operating in Malaysia and bio-diesel plant in Australia-listed Mission Biofuels Ltd. Recently warned investors that its cut-off in June of this fiscal year will be the main business income of less than half of the previous expectations. The company’s managing director Swaminathan Mahalingam said that this could be an annual output of 100,000 tons of the plant is now open for just over 40% of production capacity. He said: “Only in the case of receipt of our Order will be the production of bio-diesel.”

Of course, if fossil fuel production can not meet growing global demand for energy, bio-fuels will play a significant role. Lot of bio-diesel manufacturers in Southeast Asia said that if oil prices remain at more than 115 U.S. dollars a barrel, they will start production again.

Goldman Sachs (Goldman Sachs) predicted that if crude oil prices remain at more than 100 U.S. dollars per barrel, palm oil exports to the European bio-diesel will be able to achieve in the current balance of payments under the Price; and if you want to have on the feasibility of commercial, export of the United States similar bio-diesel is higher than the price of crude oil on the requirements of 120 U.S. dollars a barrel.

Buy palm oil from third-party manufacturers of bio-diesel, said the expansion plans they can still achieve. Such as Finland’s Neste Oil Corp. To invest 800 million U.S. dollars in Singapore biodiesel plant construction plan in progress, is expected to start operating in 2010.

Simone, vice president of Neste (Simo Honkanen) said that the company’s strong sales of high-performance bio-diesel. Neste can trust their own consumers to accept higher prices of palm oil. Simo Honkanen said: “have a first-class products will survive.”

At the same time, some Southeast Asian palm oil producers to show concern for more traditional products and markets. Palm oil is still more to be used in the manufacture of cooking oil, margarine and cosmetics, rather than the production of bio-diesel. With China and India to improve diet, edible oil demand is greatly increased, thereby pushing up prices. The United States and Europe because of the influx of soya bean oil biodiesel subsidies, including palm oil, Wilmar, including some manufacturers have to make a fresh start, trying to tap the Chinese and other Asian market opportunities for the supply of edible oil.
Check for earlier Pacific Biofuel posts: http://pacbiofuel.blogspot.com/

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