OILS AND FATS IN THE MARKET PLACE
BIODIESEL
The major biofuels in present use are bioethanol added to petrol (gasoline) and biodiesel added to petro-diesel. Bioethanol is produced from sugar cane in Brazil or from corn (maize) in the USA, with these two countries the major producers of bioethanol. Total production is growing but this is not a fat-based commodity and will not be considered further here.
Biodiesel is generally the methyl esters of natural triacylglycerols. These can replace petro-diesel completely, but more commonly the two components are blended at levels up to 5% or beyond of biodiesel for use in combustion engines.
Data about biodiesel can be discussed at three levels:
Government mandate. Many countries have laid down mandates (targets) for the introduction of blends of biodiesel. For example, the targets in EU27 were 2.5% of total transport fuel requiring 5 million tonnes of biodiesel in 2005, 5.75% requiring 11 million tonnes of biodiesel in 2010, and 10% requiring 20 million tonnes of biodiesel in 2020. These targets are not likely to be achieved but considerable progress has been made, particularly in Germany. Many other countries are declaring mandated levels and others are increasing existing mandates. These generally represent aspirations rather than achievements, but they continue to exert upward pressure on biodiesel production and consumption.
Plant capacity. Many companies have seen biodiesel production as a profitable investment. However economic aspects have always been a difficulty. Biodiesel is only profitable when it is subsidised, usually by a reduction in fuel tax. Subsidies can be given but they can also be withdrawn or reduced, making for uncertainty. As biodiesel production grows these fuel tax reductions represent a loss in national revenues which have to be made up elsewhere in the tax system. The most costly part of biodiesel production is the cost of feedstock and particularly where this is a traditional vegetable oil, costs have risen in the recent past (see webpage on Prices of Commodity Oils) with the result that many biodiesel plants are being under-used or not used at all, awaiting a cheaper feedstock. Capacity levels are considered to be around three times production levels.
Production. Except through expensive business reports it is not easy to find up-to-date information on production levels. According to the European Biodiesel Board [www.ebb-eu.org/stats.php] in 2008 EU production (9.55 mt), largely from rapeseed oil, was mainly in Germany, France, and Italy (Table 1). In July 2009 production capacity was 20.9 mt. This large gap between production levels and capacity is behind the concern in Europe about imported biodiesel. Production of biodiesel in USA is around 2 mt per annum (see below).
Feedstocks for biodiesel production can be categorised as conventional vegetable oils, fats of animal origin, and other (mainly non-food) sources. The vegetable oils used for biodiesel are mainly rapeseed oil in Europe, soybean oil in USA, Argentina and Brazil, palm oil in Malaysia and Indonesia, and coconut oil in the Philippines. Sales will be related to the relative cost of petro-diesel and biodiesel. In most developed countries biodiesel is subsidised and in many developing countries diesel is itself a subsidised product, which complicates the position further. A significant factor has been the high and volatile cost of both the fossil fuel from which diesel is distilled and the vegetable oils from which most biodiesel is made (see webpage on Prices of Commodity Oils). Cheaper biodiesel feedstock includes waste fat from frying operations in fast food shops and from industrial frying processes, animal fat below the premium grades accepted for food purposes, food from animals unfit for human consumption, and poultry fat.
The Jatrophus curcas plant is a non-food crop often grown as a hedge to keep animals out of fields. Some varieties are toxic, some are not. This plant is being grown in India and in Africa and elsewhere as a potential source of vegetable oil that can be used as biodiesel. Work remains to be done to find the best varieties of this plant and the agricultural conditions which will supply the best yields. The first samples of Jatropha oil are now available but they are still too small to affect the overall picture. In two or three years it is expected to become more significant though these achievements generally take longer than the optimistic forecasts. Other minor oils are being investigated in several countries though these changes. Of particular significance are crops that can be grown with only modest inputs on poor land that is either too salty or too dry. There have been recent reports on the cultivation of Pongamnia sp., Pistacia chinensis, Cornius wilsoniana, Xanthoceras sorbifolia, poppy seed, mustard, camelina and others in various countries as sources of oil that could be used for biofuel. These are serious studies but it will be several years before they have any significant effect on supplies of biodiesel.
Another potential feedstock is algal oil. Algae are microscopic plants able to fix carbon dioxide as carbohydrate using light as a source of energy. Under appropriate conditions the carbohydrate can be converted to lipid in situ. The carbon dioxide may be atmospheric but efficiency is increased with an enriched source such as those obtained from flue gases or from brewing processes. The photosynthetic system only operates during periods of daylight and is reversed during hours of darkness. It can be carried out in open ponds on land not otherwise suitable for agricultural production at yields in excess of those attained with conventional plants. Finally lipid has to be extracted from the biomass. Despite concerns expressed by some about the viability of producing algal biofuel a large amount of money and of skilled effort is being devoted to this issue, particularly in the US.
There are two major current concerns:
Can we produce enough oil and fat from whatever source to meet these fuel demands while at the same time providing sufficient for food purposes for a population that is growing in size at about 0.8 million each year and, especially in the developing world, has a growing income to spend on meat and lipid?
How green is the biodiesel option when all factors including change of land use are taken into account?
The following Tables contain information about biodiesel taken from a range of sources.
Table 1. Production (2008) and capacity (2009) (million tonnes) in EU and EU countries |
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| Country | Production | Capacity |
|---|---|---|
| EU-27 | 7.75 | 20.91 |
| Germany | 2.82 | 5.20 |
| France | 1.81 | 2.50 |
| Italy | 0.59 | 1.91 |
| Belgium | 0.28 | 0.70 |
| Poland | 0.27 | 0.58 |
| Portugal | 0.27 | 0.47 |
| Denmark/Sweden | 0.23 | 0.35 |
| Austria | 0.21 | 0.71 |
| Spain | 0.21 | 3.66 |
| UK | 0.19 | 0.61 |
| Other | 0.87 | 4.22 |
Table 2. Production (million tonnes) of biodiesel since 2006 with forecast for 2010 (f) |
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| 2006 | 2007 | 2008 | 2009 | 2010(f) | |
| EU | 4.85 | 5.95 | 7.49 | 8.42 | 9.55 |
| Germany | 2.55 | 2.93 | 2.67 | 2.50 | 2.73 |
| France | 0.74 | 0.87 | 1.82 | 2.00 | 2.20 |
| Other | 1.56 | 2.15 | 4.00 | 4.92 | 4.62 |
| USA | 1.13 | 1.70 | 2.69 | 1.80 | 2.10 |
| Argentina | 0.05 | 0.18 | 0.74 | 1.16 | 1.60 |
| Brazil | 0.06 | 0.36 | 1.03 | 1.40 | 2.00 |
| Other | 1.03 | 1.33 | 2.37 | 2.94 | 3.91 |
| Total | 7.12 | 9.52 | 14.32 | 15.72 | 19.16 |
| Change | 3.5 | 2.4 | 4.8 | 1.6 | 3.2 |
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Table 3. Animal fats used in biodiesel production (2009) in selected countries. |
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| Mt | Bd | % | |
|---|---|---|---|
| Total | 1.04 | 11.00 | 10 |
| USA | 0.47 | 2.33 | 20 |
| EU | 0.34 | 5.70 | 6 |
| Brazil | 0.15 | 0.97 | 15 |
| Canada | 0.08 | 0.08 | 90 |
| Other | 0.00 | 1.92 | |
Readers may be interested in the article "Historical Perspectives on Vegetable Oil-Based Diesel Fuels" by Gerhard Knothe on this site.
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Scottish Crop Research Institute (and MRS Lipid Analysis Unit), Invergowrie, Dundee (DD2 5DA), Scotland |
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Updated: April 15th, 2010 |
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