Today in Biofuels: UK order biofuels impact review in Science magazine aftermath; how Fidel Castro biofooled the world on biofuels; “I don’t think there are enough acres to satisfy the demand in all these commodities”, says trader
Submitted by Biofuels Digest Blog
Top Story:
In reaction to articles published last week in Science magazine, the UK government has ordered a revised analysis review on biofuels, but reconfirmed a biofuels target of 2.5% of transportation fuel by April, rising to 5% by 2010. Meanwhile, Greenpeace called on the government to suspend biofuels targets. John Sauven, executive director of Greenpeace UK, said “The scientific evidence is mounting - biofuels are often more damaging to the climate than the fossil fuels they are designed to replace.” In London at International Petroleum Week, Jos Dings, director of the European Federation for Transport and Environment, said quantity targets for biofuels should be dropped in favor of a low-carbon standard, which gives incentives to companies to invest in high-performance, advanced biofuels.
How Fidel Castro biofooled the world on biofuels; “global starvation” no longer an issue as Cuba rockets forward with sugarcane ethanol.
Producer News:
In Florida, Lee County commissioners will vote shortly on a $1.3 million project to convert waste vegetable oil to biodiesel for county vehicles. The proposed facility would be built at the Gulf Coast Landfill and use methane from the landfill to power the plant. Local residents are among opponents of the plan, which critics say has unproven economic benefits.
In Oklahoma, the Durant Biodiesel plant will convert from soybean oil to a multi-feedstock process, primarily restaurant grease. The cost and timing of the conversion has not been disclosed, but the facility, owned by Earth Biofuels, has been running at minimal capacity since 2007 due to high soybean prices.
In Michigan, Biofuel Industries Group has signed an agreement with GreenShift to procure $10 million of proprietary biodiesel equipment, to expand its capacity by 20 Mgy. Biofuels Industries, which does business as NextDiesel, had previously purchased $10 million in equipment from GreenShift for its pork fat, crude vegetable oils and high free fatty acid-based biodiesel.
In Illinois, Aventine Renewable Energy released its results for the fourth quarter, reporting net income for the fourth quarter of $3.3 million, or $0.08 per fully diluted share, on EBITDA of $11.4 million. The company said that average ethanol sales price declined in the fourth quarter but quarter end prices were significantly higher, corn costs fell to $3.66 per bushel and co-product returns increased to 45.3 percent. The company said would continue with construction of new plants in Nebraska and Indiana, after the company ran at 93 percent of capacity in 2007.
International News:
In Australia, the federal government declined to change its 2050 greenhouse target despite a report from its top climate adviser calling for a cut of carbon emissions of 90 percent by 2050, up from the national target of 60 percent which the Labor government committed to in the recent national elections. The Australian Greens said that the 60 percent target was based on an analysis done in 2000, which was overdue for revision. Opposition senator Barnaby Joyce said that the proposed 90 percent reduction target would “require getting about 10 million Australians to go and live somewhere else, or reducing the average aspirations of the current population down towards the aspirations of the average person in Chad.”
In Jamaica, Jamaica Broilers Group achieved $1.8 billion in ethanol sales for the fourth quarter of 2007, up on prices increase from $1.75 per gallon to $2/.20 per gallons at its 60 Mgy ethanol processing plant, which became operational last July.
In India and Canada, Saskatchewan University signed an agreement with the Indian Agricultural Research Institute to cooperate on research into second-generation biofuels. The agreement calls for research into the use of acid hydrolysis and supercritical carbon dioxide to produce fermentable sugars, the production of biodiesel using ultrasound technology, conversion of waste biomass into biogas and fertilizers, and the supercritical water process to produce hydrogen from biomass.
Research News:
In Illinois, May soybean futures closed Thursday at $14.24 a bushel, wheat futures reached $10.45, and corn settled at $5.37, all nearly double from 2006. The Agriculture Department will release its projection of acres planted in March, while Chicago grain trader Dan Brophy told the Chicago Tribune, “personally, I don’t think there are enough acres to satisfy the demand in all these commodities”. The US Agriculture Department projected farm-grown exports at $101 billion in the 2008 fiscal year, a 23 percent increase over 2007 that would result in a $24.5 billion agricultural trade surplus. The trade balance has improved $10 billion since November, despite a falling dollar. However, the American Bakers Association warned that wheat reserves fell to a 27 day supply, compared to the historic average of 90 days.
Policy and Policymakers:
In Washington, the League of Conservation Voters released a national environmental scorecard. Sen. McCain of Arizona, the likely Republican nominee, rated a zero out of 100 on environmental issues, compared to a career average of 24 percent. Senator Clinton received a 73 percent rating, compared to a career average of 87 percent, while Senator Obama scored 67 percent compared to a career average of 86 percent. McCain has sponsored climate change legislation but missed all 15 votes tallied in the scorecard, including the final vote to break a filibuster on the Renewable Power Standard late last year.
In Brazil, President Luiz Inácio Lula da Silva told the Global Legislators Organisation for a Balanced Environment (GLOBE) forum that “Agroenergy offers a historic opportunity,” in the transition to a new energy mix, but said that “a revolution that will only take place if rich countries open their markets, reducing their farm subsidies.” Lula and other smaller nations have failed to win concessions on agricultural subsidies at the Doha Round of trade liberalization negotiations. Lula said that Brazil has 60 million hectares of unused grassland, already deforested and not used for pasture, and said it could be converted for ethanol and biodiesel production without adverse climate effects.
Consumer and Fleet News:
In California, GM is sponsoring an 85 cent per gallon promotion at the first LA-area E85 station, which is operating in fashionable Brentwood. GM said there were 46,000 flex-fuel cars in the LA metro area.
Financial News:
The Biofuels Digest Index™ (BDI), a basket of public biofuels stocks, rose 0.09 percent Thursday to close at 127.12 as ethanol stocks weakened in light of rising corn future prices. For the day, diversified agribusiness Archer Daniels Midland (ADM) gained 0.18 percent to close at $45.42. Among ethanol stocks, VeraSun Energy (VSE) fell 0.91 percent to $7.62 while Aventine Renewable Energy (AVR) fell 0.12 percent to $8.50 after releasing 4th quarter earnings with EBITDA on lower corn prices and increased income from by-products. Among small caps, Environmental Power (EPG), up 8.44 percent to $4.88, led gainers, while GreenPlains Renewable Energy (GPRE) fell 5.44 percent to $8.52. For the day, declines led advances 2 to 1.
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