Africa to become the world's biodiesel supplier?
Crude palm oil (CPO), used extensively as a biodiesel feedstock in South East Asia, has seen its popularity go through the roof over the last few years as Europe's mandatory biodiesel targets have seen global demand boom. Despite the environmental concerns over large scale rainforest destruction to make way for ever more oil palm plantations, the price of CPO has been low enough that economic demand has not waned. The laws of supply and demand have started to kick in though and suddenly palm oil biodiesel is struggling to match the recent falls in petroleum diesel prices.
In the same time that crude oil prices have fallen 24 percent from last year's record of $78.40 per barrel to $60 per barrel, CPO prices have risen by an even greater degree, a massive 35 percent. After factoring currency conversion rates from the Malaysian Ringgit to the U.S. Dollar, plus production costs to turn the raw oil into biodiesel, estimates put the current price of palm-based biodiesel at close to $90 per barrel.
Even while palm oil's sun may be setting, the new kid on the biodiesel feedstock block, Jatropha oil, is gaining widespread acceptance as a more environmentally friendly and potentially less economically volatile route to a widespread biodiesel future. The price of Jatropha oil, which is non-edible, can not be influenced by fluctuations in food prices unlike palm oil which is a major edible oil crop in addition to being a biodiesel feedstock. Social commentators who have expressed concern that edible oil feedstocks like rapeseed oil, soybean oil and palm oil are being used for fuel when there are people starving in Africa are likely to support Jatropha as a good compromise.
Ironically, Jatropha's popularity is seeing money being pumped into African agriculture, but once again not for food, just for biodiesel production. The long-living plant is being viewed as the spark that can revive the African economy. Africa could potentially become the world's biggest supplier of biodiesel with Norwegian, Indian and British companies moving quickly to secure massive tracts of land on the continent for Jatropha plantations.
Analysis: Palm oil has to this point been a cheap feedstock for European and Asian biodiesel, but its environmental concerns have never been sufficiently answered. Jatropha's ability to flourish on marginal land means that it can be grown in many existing locations without further clearing of forests necessary. Africa as the world's biodiesel supplier - a remarkable thought.
Related:
- Palm oil production and prices soar on back of biodiesel
- India closing biofuels plants, Brazil opening them
- "I pledge allegiance to getting better mileage"
Reader Comments (Page 1 of 1)
JoeP 1:24AM (3/04/2007)
Please explain more about crude palm oil (CPO). Is it usable as is, or does it need to be refined?
If it needs no refining, and is $90/bbl, it is $90/55gal = $1.63/gal...very nice.
If it dies need refining, I doubt it is the same refining process as petroleum oil, so it won't cost the same.
I may be wrong, but it seems like the author of this article took someone's word for the lack of viability of CPO w/o investigating...if they did ivestigate, they didn't share their results.
Also, if jatropha is grown, there is no chance to eat it, so I don't see how that would help people have more food.
For edible crops, when the price of fuel dips down, there will actually be more food available.
Am I missing something?
Reply
HanyE 1:18PM (3/30/2007)
JoeP, The point you're missing is...
If biofuels are not based on edible plants in the first place, they will never have an effect on food supplies. Why not use a plant that would otherwise be useless specially if the cost to refine them is the same. The article also states than the Jatropha plant can be planted in less hospitable soil so it can be planted in what would otherwise be nearly useless land.
"For edible crops, when the price of fuel dips down, there will actually be more food available"
The need for fuel and the need for food are both determined by the human population which is constantly growing. If the laws of supply and demand are in effect here, demand is ever growing and at a rather fast rate. I doubt the price would ever drop with the constantly increasing demand.
It just makes more sense to use the right source from the start than try to switch supplies later.
Reply
Howard Lee Harkness 2:08PM (3/30/2007)
Palm oil and Jatropha are suboptimal feedstocks compared to algae. Algae can grow nearly anywhere (helps to have a nearby source of sewage and/or garbage), and has yields orders of magnitude higher than either Palm or Jatropha. Algae is wonderfully easy to grow -- it's hard to PREVENT, although I expect that some care will be needed to make sure that you are growing only higher-yield strains of the stuff.
In answer to JoeP, to get biodiesel from any veggie oil, it must be 'refined'. A significant byproduct of the process is glycerin. Glycerin has a few uses, but there is currently much more being produced than there is demand. It is possible to use SVO in a diesel engine, but that requires some fuel-system engineering -- mostly to make sure that the oil doesn't get too thick in cold weather.
I would definitely like to see more widespread use of SVO. It's cheaper than biodiesel, and the engineering challenges are relatively minor. Plus we wouldn't have to figure out what to do with all that glycerin.
Reply