Today in Biofuels: Virgin to fly 747 London-Amsterdam on B20 biodiesel; Amazon deforestation pace picks up; Chinese commence massive biofuel forest plantation with four tree varieties
Submitted by Biofuels Digest Blog
Top Story:
In England, Virgin Atlantic announced that it will make an 80 minute test flight next month using a B20 biodiesel blend. The biodiesel feedstock was not revealed, but the company said that it would not be palm oil or any other unsustainable feedstock. The flight will involve a crew only and will take the plane from London to Amsterdam. The use of B20 will not require any modifications to the General Electric CF6 engines. The test, resulting from a collaboration between Virgin, Boeing and General Electric, will be mirrored by another test next month by Air New Zealand.
Producer News:
In Texas, owners of the Galveston Bay Biodiesel project have sued Chevron, which owns 22 percent of the venture, for failing to follow through on funding promises. The other partners had to put up $15 million to satisfy liens and other obligations after Chevron refused to participate in an additional funding round. Chevron said that the partnership documents did not require the company to participate in the investment round. Galveston Bay executives say that Chevron gave verbal assurances that it would participate that the company and its other investors relied upon. The plant is scheduled to expand to 110 Mgy in production capacity this year.
In Illinois, researchers at University of Illinois at Urbana-Champaign surveyed local farmers and report that the major challenge in developing cellulosic ethanol will be to persuade farmers to grow the crop. Farmers indicated in the survey that they would only grow cellulosic crops if they could be persuaded that the cellulosic crops such as switchgrass and miscanthus can compete with soybeans and corn in terms of profitability.
International News:
In Singapore, Neste Oil has selected Technip as contractor for its 240 Mgy next-generation biodiesel plant in Singapore. The $800 million project will be the world’s largest biodiesel plant. Construction will commence in the first half of 2008.
In France, the president of the European Biodiesel Board said that low-cost Argentine exports were a major concern for the European producers, noting that Argentina exported 300,000 tons of biodiesel in 2007. Bernard Nicol, also the president of Diester Industrie, a French biodiesel producer, said that Argentine B100 exports received favorable tax treatment in Argentina, received a $1 “splash-and-dash” credit per gallon in the United States by blending it to B99, and then received subsidies in Europe upon arrival. Nicol predicted that Argentine exports would increase in 2008.
In Brazil, researchers say that Amazonian deforestation has increased in pace in 2007 and is likely to rise throughout 2008. Carlos Nobre, a scientist with Brazil’s National Institute for Space Research, said that 2,300 square miles of forest had been converted to farmland in the past four months, compared with 3,700 square miles in the 12 months ending last July.
In China, the central government will plant more than 15,000 acres of Chinese pistache trees as biofuel feedstock, relying on their tolerance of drought and low-fertility soil, and the 40 percent oil content of their seeds. Overall the seven regions designated by the State Forestry Administration (SFA) in 2006 to grow biofuel demonstration forests (Hebei, Anhui, Hunan, Sichuan, Yunnan and Shanxi provinces and Inner Mongolia Autonomous Region) will cultivate a total of 830,000 acres of Chinese pistache, jatropha, yellowhorn and Wilson’s Dogwood by 2010. Hebei’s overall plan is to grow more than 1.7 million acres of biodiesel forest by 2050 to provide more than 500 Mgy of biodiesel.
Research News:
In Washington, the president of the Earth Policy Institute said that 30 percent of the US corn crop will be used for ethanol in 2008 and will lead to price increases for food prices. Lester Brown told the Reuters Global Agriculture and Biofuel Summit that grain prices are now tied to oil prices and that, as a result, prices will increase for meat and dairy products that are dependent on corn feed.
In Illinois, a senior vice president with Memphis-based Informa said that Chicago Board of Trade corn and soybean futures prices will remain at or near all-time highs in 2008 due to continued demand pressure for domestic food, exports and biofuels. Scott Richman said at the Reuters Global Agricultural and Biofuel Summit that he expects December corn to reach as high as $6 this spring, and soybean futures to trade in the $12.75-$13.10 range.
Policy and Policymakers:
In Brazil, the head of the Brazilian Sugar Cane Industry Union said that national and regional trade barriers and tax policies are interfering with the drive to provide eco-friendly fuels to consumers and industry. Marcos Jank said, at the Reuters Global Agriculture and Biofuel Summit, that he expects the EU to impose trade barriers to Argentine and US biodiesel in retaliation for subsidies and tax preferences in the Americas that have led to dumping practices in Europe. Jank said that countries are seeking national economic benefit, rather than approaching climate change as a global problem.
Consumer and Fleet News:
In Utah, car designers preparing for the Bonneville Speed Week have debuted a variety of high-speed biofuel cars. The biofuel-powered vehicles will challenge for world speed records on the Bonneville Salt Flats. Ford’s Fusion Hydrogen 999 electric motor provides 750 horsepower and is expected to easily surpass the 315 mph achieved by the Buckeye Bullet in 2004, while the E85 Dodge Viper recently broke the world land speed record for the standing mile in a production car when it reached 220.7 mph.
In Colorado, Safeway announced that it is converting its entire nationwide fleet to B20 biodiesel. Colorado Gov. Bill Ritter and Sen. Ken Salazar attended the company’s announcement in Denver.
Financial News:
The Biofuels Digest Index™, a basket of public biofuels stocks, plunged 5.45 percent yesterday to 120.58 as profit taking and falling grain prices hit agribusiness hard and ethanol stocks continued to slide. For the day, declines led advances 3 to 1 as Archer Daniels Midland (ADM) fell 5.84 percent to close at $42.37. Bloggers said that the slide was temporary. Among mid caps, Aventine Renewable (AVR) eked out a modest 0.51 percent gain to close at $9.95, but Pacific Ethanol (PEIX) fell 7.38 percent to close at $6.15. Among small caps, GreenShift (GSHF.OB) fell 19.23 percent to $0105 and Bio Solutions Manufacturing (BSLM.OB) tumbled 12.50 percent to $0.028, while Nova Biosource (NBF) made a small 0.43 percent gain to close at $2.34.
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