Monday Edition

05.12.08

GLOBAL

OPEC could schedule an emergency meeting before its next policy-setting gathering in September to try to prevent a further spike in global oil prices, Libya's top oil official said Friday. He also said that oil prices, which have hit a record high, could rise further regardless of supply availability.

NORTH AMERICA

US President George W. Bush says he will veto the five-year, $300 billion farm bill, which is expected to be on the House floor later this week and go to the Senate soon thereafter. The Bush Administration says the bill includes wasteful handouts to wealthy growers. Supporters of the bill say it provides a necessary rural safety net that also expands nutrition aid for the poor.

Green Star Products has released a report on its 10,500 gallon algae-to-biodiesel demonstration facility, saying it has completed a test cycle which started in 2007, and commercial production will begin in 2008-2009.

Nebraska-based Green Plains Renewable Energy and Virgin Bioverda of Illinois have entered into a merger agreement to create a 330 million gallons per year ethanol company. “The proposed merger will create one of the nation's largest publicly-traded, pure play ethanol companies, based on projected year-end capacity,” said Wayne Hoovestol, Green Plains' CEO.

Miami, FL Mayor Manuel A. Diaz has approved a biofuel purchasing program and Biodiesel of South Florida is reportedly the top bidder for the biodiesel supply contract. Diaz plans to have 1,000 city vehicles operating on hybrid technology or alternative fuels by 2012, using biodiesel and ethanol as the two main alternative fuels.

In Washington State, used cooking oil is being stolen from restaurants. The restaurants have contracts with biodiesel manufacturers such as Standard Biodiesel in Arlington, CA and Gen-X Energy in Burbank, CA, but thieves are stealing the used oil before legitimate collectors can retrieve it from restaurants.

Canada’s new biofuel law is likely to become official in a couple of weeks, a Canadian Renewable Fuels Association official told Dow Jones. The bill, which would require 5% ethanol in all gasoline and 2% biodiesel in diesel by 2010, is expected to have its third review this week, and then move on to the Senate.

SOUTH AMERICA

In Argentina, the farmers’ strike is not showing any signs of a settlement. Farmers have told the government they are prepared to continue the strike if there is no progress in negotiations. Some roadblocks have appeared, mainly to stop trucks from delivering grains to port terminals.

The private-equity group within Goldman Sachs is among the backers of Brazilian Renewable Energy Co. Ltd., a São Paulo-based company that plans to have 10 ethanol plants running by 2015, as well as a pipeline to transport ethanol to the port of Santos. In addition, BP has said it plans to invest more than $550 million in Brazil's ethanol industry. Investor access to Brazilian ethanol through mutual funds and publicly traded companies could soon evolve.

EUROPE

According to the Financial Times, the US biodiesel industry will lobby for World Trade Organization legal action against their European counterparts. The move reportedly comes after last week's announcement that European Union biodiesel manufacturers will ask the European Commission to impose emergency duties on US imports to combat what it describes as subsidies and unfair pricing. A legal opinion from the law firm Mayer Brown commissioned by the US National Biodiesel Board says the EU's technical fuel requirements, including biodiesel's resistance to oxidation, break WTO rules by discriminating against US producers, the Financial Times reports.

The largest biofuel plant in the European Union should be operational by the first half of 2009, consuming a substantial amount of Britain's exportable wheat surplus. The 330,000 tons per year plant being built in northeast England will produce ethanol and a protein-rich animal feed from about 1.3 million tons of British wheat. The plant is expected to supply one-third of UK demand for ethanol under Britain's Renewable Transport Fuels Obligation (RTFO).

ASIA / PACIFIC

China Clean Energy reported financial results for the first quarter ending on March 31, 2008. Net revenue was $4.47 million, an increase of 8% over the same period in 2007. Biodiesel accounted for 12% of total revenue, with 770 tons of biodiesel shipped at an average price of $717 per ton after value added tax (VAT). Gross profit was $1.04 million, compared to $1.15 million during first quarter of 2007, and gross margin was 23%, down from 28% in the first quarter of 2007, due to an increase in the cost of raw materials.

AUSTRALIA

Mission Biofuels has pushed back the likely opening date for its second 250,000 mt per year biodiesel plant in the Malaysian port of Kuantan to December 2008, according to an official with the company. The Australia company has already pushed back the Kuantan project once, from March 2008 to August 2008, saying it was looking at new technology for the plant.

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