May 1, 2012


EU biodiesel makers to sell more in Spain


Following new measures which effectively shut out Argentine and Indonesian imports, European biodiesel makers will be able to sell an additional one million tonnes a year in Spain, an industry spokesman said.


Spain decreed on April 20 that only biodiesel produced in the EU could be used to comply with a legal minimum of 7% which has to be blended with mineral diesel used in motor fuel.


Industry group APPA Biocarburantes estimates that 90% of the 1.2 million tonnes of biodiesel consumed in Spain last year came from Argentina and Indonesia. Some of the remaining 10% came from other EU countries.


"There is no ban at all on importing or using product," APPA Biocarburantes President Manuel Bustos said in an interview. "If it can't be used for minimum blending, then it is most likely that petroleum operators won't be interested in buying it, so the non-EU part will be out of the game."


The government decree was passed days after Argentina seized Spanish-owned oil firm YPF, but had been drafted months earlier to help Spain's biodiesel industry, which was working at just 14% of its 4.5 million tonnes per year capacity.


Any biodiesel plant in the EU can apply to register with Spain's Industry Ministry for complying with minimum blending, which will require an estimated 1.8 million tonnes in 2012. The process would likely take several months.


"We cannot know right now how (registration) will be shared out, but the fact supplies will have to take place in Spain will probably confer a competitive advantage on plants in Spain or neighbouring countries for logistical reasons," Bustos said.


"The decree has probably come too late for some Spanish plants which evidently were not in a good economic state, but the rest will be more than able to supply that 1.8 million tonnes."


One difficulty Spanish biodiesel makers have is that they have to import virtually all the vegetable oil used as a raw material because the country grows few oilseeds and has yet to collect significant amounts of used oil.


"One of the great shortfalls in policy to promote biofuels is that we have not managed to develop home-produced raw materials," Bustos said. "An extra effort is needed as well as developing energy crops like rapeseed."


Spain produced just 62,000 tonnes of rapeseed last year. It also produced about one million tonnes of sunflower seeds, which are mainly used to make cooking oil or in animal feed. Bustos said Spain's bioethanol exports would likely benefit from an expected drop in US imports after the EU closed a tariff loophole earlier this month.


The imports did not directly affect Spain's industry, because its plants were working last year at 78% of capacity, which is 460,000 tonnes a year.


"Where it (the loophole) did have an impact was on sales to other EU countries, because it obviously tended to drive prices down," he said.


Spain has four bioethanol plants - three of them owned by multinational Abengoa - with a capacity of 460,000 tonnes a year, and they export 46% of output.

Video >

Follow Us