Wednesday Edition

07.10.08

GLOBAL

The World Bank has refuted a recent story by The Guardian claiming access to a “secret report” that blames biofuels for 75% of the rise in global food prices. The report was a World Bank “working paper” meant to contribute to a position paper on food prices. According to a World Bank spokesperson, the draft paper actually attributes higher food prices to a combination of higher energy prices, increased fertilizer costs, a weakened US dollar, and biofuels demand as well as related low grain stocks, large land use shifts, speculative activity, and export bans.

Leaders from the Group of 8 industrialized powers say they are concerned about rising oil and food prices, but remain positive about the outlook for the global economy. The G-8 called for diversifying sources of energy, improving energy efficiency, biofuel sustainably, and reducing greenhouse gas emissions by at least 50% by 2050.
Rising demand for palm oil will impede biodiversity unless producers and political leaders can work together to preserve as much remaining natural forest as possible, ecologists have warned. A new study published in the British Ecological Society's Journal of Applied Ecology found that very little can be done to make palm oil plantations more hospitable for local birds and butterflies.
Soybean prices may continue to move higher this week, driven by concerns of a smaller than expected US acreage and weather worries, Dow Jones reports. In India, soybean planting has slowed in the past eight to ten days due to little rain in the key producing state of Madhya Pradesh.

NORTH AMERICA

In Pennsylvania, both houses of the state legislature have passed a bill to provide state biodiesel manufacturers up to $15.9 million in subsidies over three years. The bill will give producers $0.75 per gallon produced beginning immediately with a cap of $1.9 million for each producer. The subsidies are to expire in the 2010-2011 fiscal year. The legislature also passed biodiesel blending mandates of 2% to come into effect one year after in-state production reaches 40 million gallons.

The South Dakota state tax on biodiesel will be reduced from $0.22 per gallon to $0.20, the same tax break given to ethanol. The reduction will be for B5 or greater from soybean or other plant oils, taking effect when in-state biodiesel production capacity reaches 20 million gallons a year.

In Puget Sound, WA, the Sno/Sky Agriculture Alliance of Monroe will award a $96,806 grant for construction of facilities to grow and store canola, mustard, and other oilseed crops for biodiesel production.

In North Carolina, 11 Libby Hill Seafood Restaurants have teamed up with Patriot Biodiesel to convert used vegetable oil into fuel, potentially providing up to one-third of the company's diesel needs. Libby Hill will collect the oil and deliver it to Patriot for biodiesel production in exchange for one gallon of biodiesel for every five gallons of use vegetable oil.

In Maryland, the Federal Correctional Institution at Mexico Farms is opening a cooking oil recycling location where biodiesel fuel will be made to power some of its vehicles.

In Connecticut, the town of Greenwich has dropped a plan to use a soy biodiesel to power half of its 300-vehicle fleet after the price of biodiesel became too high, officials said. A move to soy biodiesel had been approved if the price per gallon did not exceed the price of standard diesel by more than $0.25.

SOUTH AMERICA

In Argentina, the House has passed the president’s export tax bill, including changes to alleviate some fiscal pressure on small and medium-sized producers. However, these changes do not apply for next year, causing all farmers to shoulder the full weight of the tax. Farmers say they are not satisfied with the outcome and will fight for changes when the bill is debated in the Senate next week.

In Brazil, Rio de Janeiro's municipality of Resende has completed the first phase of research on biodiesel production from oleaginous plants. Under the program, sunflower, castor bean, palm, and turnip plants will be used as feedstock. The first 793 gallon per day biodiesel plant is scheduled to be operational in September.

ANP warned that Brazil may lose its oil self-sufficiency due to the growing fuel consumption in the country. In the first four months of 2008, Brazil's oil and derivatives imports were higher than its exports, and the government expects the oil sector to end 2008 with a trade deficit.

Bionerg SA says its biodiesel plant is among the first in South America equipped with a dry washing technology for biodiesel purification. Bionerg says it has exported this plant technology to a 23,000 mt per year soy oil plant in Arkansas (US), and is developing similar projects in Argentina and in other South American countries.

Chile’s Energy Minister announced creation of a Renewable Energy Centre for Chile and South America which will work with member countries of the Union of South American Nations on renewable energy development, promoting innovation and research, and adapting technology developments from around the world.

The Dominican Republic is poised to benefit from the growing international interest in jatropha, which is grown natively on the island and has been considered until recently as little more than a useless weed, officials say. The feasibility of commercial planting has yet to be examined.

EUROPE

The European Parliament's Environment Committee has rejected the EU's 10% biofuel target for Europe's on-road fuels by 2020, instead backing a shift toward renewable electric and hydrogen-powered vehicles. Committee members voted that the on-road share of renewable energy should be at least 8%-10% in 2020, out of which 40%-50% would be met by electricity or hydrogen from renewable sources, and second-generation biofuels such as cellulosic biomass. They also backed an interim renewable on-road target of at least 4% by 2015.

ASIA / PACIFIC

Denso Corp., a subsidiary of Toyota, is working on an algae-to-biodiesel project that aims to produce 88 tons of algae per year from 2013. The company has also begun research on using algae to absorb carbon dioxide emissions from its factories.

Malaysia will not expand its oil palm acreage but instead will apply research and development to increase it vegetable oil yields, the Prime Minister said. He believes Malaysia and Indonesia can increase palm oil production by at least 30%, and possibly 50%, due to new technologies.

AUSTRALIA

The Moringa oleifera tree, from the foothills of the Himalayas, has emerged as a potential biodiesel crop for Western Australia due to terrain. Trial plantings of the tree have shown promising initial results.

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