Biodiesel viewed as cost-fighter in South Korea
South Korea may become the Asian equivalent to Brazil in producing biofuel. Singapore, one of the largest regional oil refiners, has easy access to palm oil, a component of biodiesel, from Malaysia and Indonesia. Already one entrepreneur, Kom Mam Sun, who opened his biodiesel plant in June, has earned a profit from his biodiesel plant.But German commodities company Cremer Gruppe has more ambitious plans. It plans to build a biodiesel plant in Singapore by 2007 which will produce over 200,000 tons of biodiesel. According to Cremer Gruppe's marketing director John Hall, the company plans to sell the fuel at $40 a barrel, considerably less than the current $70 a barrel for crude oil. While many environmentalists continue to debate biodiesel productions ultimate effects, analysts say interest in alternatives continue to increase. States analyst Victor Shum, "The fuel market is so big that biodiesel can't make a significant difference and will only be a small fraction of the overall diesel use in Asia. But with oil prices so high these days, biodiesel does get more and more cost-effective."
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[Source: Reuters]
Reader Comments (Page 1 of 1)
Megherbi 6:37AM (5/17/2008)
fuck you with your Business
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Howard Lee Harkness 1:32PM (8/20/2006)
States analyst Victor Shum, "The fuel market is so big that biodiesel can't make a significant difference and will only be a small fraction of the overall diesel use in Asia."
Victor Shum is wrong about this, but it hardly matters. As he notes later, biodiesel is definitely cost-effective, and that is the important point.
Selling biodiesel for $40/bbl is a tactical mistake, when the closest competitor is $70/bbl. A much more effective tactic would be to price biodiesel at about $5/bbl under whatever processed dinodiesel is selling for. That will still insure that you sell all you can possibly make, with almost obscenely better profits in the short run. Later, when the large profits attract more competition, the prices will go down -- but if there really is a shortage (and I think there will be for quite a while), the price will always be closer to the dinosaur-juice price than to the marginal cost of production of biodiesel.
LOTS of money to be made in biodiesel, even without government help (*better* with no 'help' from the gubbermint). There is money to be made with ethanol, too, but that depends heavily on tax breaks and other direct and indirect government subsidies and coercion. Nobody but the most committed green-freak (ignoring the questionable environmental 'benefits') is going to willingly pay more for reduced performance and fuel mileage in his vehicle.
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SAFACAM S.A 6:24AM (1/04/2008)
Dear Sir
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Dizangue Subdivision Sanaga Maritime.
We saw you wanted palm oil we are producer of this various types of oil.
Contact us for more info.
Crude Palm oil
refined Palm oil
kernel Palm oil
soy beans oil.
Sunflower oil
Mr. J.P Charbon.
D.G (Director General).
SAFACAM S.A (Societe Agricole Forestiere Du Cameroun) .
PLANTATION DIZANGUE.
B.P 100 Douala / CAMEROUN.
TEL: +(237) 94 58 91 57 /94 58 91 45.
FAX: +(237) 33 43 35 53
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