The U.S. agribusinesses have joined Brazilian companies that are expanding facilities in a bet the government will double to 10 percent the amount of biofuel that must be blended into petroleum-based diesel, driving up demand overnight.

With oil above $100 a barrel, President Dilma Rousseff is looking for alternative fuels to fill trucks’ tanks and keep a lid on inflation. Expanding production would also boost the economy of Brazil’s impoverished center-west region, where most of the industry is based. The risk is the country will be awash in unneeded biofuel, said Roberto Rodriguez Labastida, an analyst at Bloomberg New Energy Finance.

“There’s far more biodiesel refineries online than are necessary,” Rodriguez Labastida said from the research group’s office in London. “I wouldn’t say it’s smart to invest” in any more facilities to process soybeans into fuel.

Brazil demands that diesel sold at the pump contain 5 percent biofuel. It’s the third-largest market by capacity after the U.S. and Germany. Executives at four refiners said they expect the government to double that to 10 percent within three years, giving Brazil the world’s highest biodiesel blending rate.

Edison Lobao, Brazil’s Minister of Mines and Energy, is considering a higher blend rate as long as there’s enough vegetable-oil that can be processed into fuel, according to a statement posted on the ministry’s website May 4. He did not say how much it may be increased.

A Cargill spokesman declined to discuss the company’s biodiesel plans. ADM and Bunge Ltd. (BG), another U.S. agribusiness approved to build in Brazil, did not respond to inquiries.

Europe, U.S. Overcapacity

Overcapacity is also an issue in Europe, where plants are operating at about 40 percent of potential, and in the U.S., which according to some measurements is running at about 24 percent, according to Claus Keller, senior analyst of Ratzeburg, Germany-based biofuel consulting company F.O. Licht.

Doubling the concentration would rocket demand for the fuel and would cut imports of petroleum-based diesel, easing Brazil’s balance of trade.

“Brazil is bound to increase the biodiesel blend to 7 percent in the next 5 months,” said Paulo Jose Fuga, a manager at Fuga Couros SA. The Marau, Brazil-based leather maker and meat processor is spending 22 million reais ($13.6 million) on a biodiesel plant that will process as much as 108 million liters (29 million gallons) a year beginning in February. He forecast the requirement reaching 10 percent by 2014.

21 Projects

The Fuga project is one of 21 in Brazil, either new plants or expansions of existing ones, that received permits in the last year to begin construction from fuel regulator Agencia Nacional do Petroleo, Gas Natural e Biocombustiveis.

Developers include Decatur, Illinois-based Archer-Daniels- Midland’s local unit, ADM do Brazil Ltda.; Minneapolis-based Cargill; and Bunge, based in White Plains, New York. Together they are set to add slightly more than 2.2 billion liters of annual capacity, increasing the production base by about 38 percent, according to the regulator.

New biodiesel units in Brazil cost about $0.25 a liter to build, according to data compiled by London-based New Energy Finance. Rodriguez Labastida estimates that refiners are investing more than $560 million to boost their capacity, based on construction permits they have received.

Refiners, which make the fuel by treating vegetable oils or animal fats with alcohol in a chemical reaction, say they need more capacity to keep pace with rising demand for the standard diesel with which it’s mixed.

Rising Consumption

Even without the blending increase, national consumption of the fuel is expected to rise by 6 percent a year over the next decade, according to a Ministry of Mines and Energy projection.

The producers are overly optimistic about their sales outlook because national output capacity is growing faster than demand, according to F.O. Licht’s Keller.

There’s “already strong competition for volumes,” in the government’s quarterly auctions for the fuel, he said. “That’s only going to increase as more plants start operations.”

Only biodiesel projects with access to cheap raw materials, like soybean and animal fats, or “at minimum, ownership over a seed crushing plant,” make economic sense, Keller said. “I’d only build a project if I had access to the feedstock for the next 10 years.”

More Refineries

There are about 60 biodiesel refineries selling fuel in Brazil with production capacity of 5.9 billion liters a year, according to fuel regulator ANP. That’s up from 47 at the start of 2010.

The average price of biodiesel in a government-organized auction in February was 2.05 reais a liter, down 11 percent from the previous auction in November, according to ANP. Soybean oil was selling for 2.14 reais a liter on April 28 in Sao Paulo, according to information compiled by Bloomberg.

Brazil imported 9 billion liters of diesel last year, according to the Secretary of External Commerce. Increasing the percentage of biodiesel in the fuel sold at retail would decrease the amount of standard diesel in drivers’ tanks and would have saved the country about $2.2 billion in the first half of 2010 on imports, according to Brazil’s biodiesel trade group Uniao Brasileira do Biodiesel.

Vegetable Oil Supplies

Keller questioned the impact of a higher blend rate on Brazil’s farmers. A 10 percent requirement may require an additional 2.4 billion liters of vegetable oil to produce, double the current level, he said.

That new blend obligation may consume as much as 69 percent of the 7.4 billion liters of soyoil that the Brazilian vegetable oil trade group Associacao Brasileira das Industrias de Oleos Vegetais predicts will be produced in the 2011 to 2012 harvest season. About 84 percent of Brazilian biodiesel was derived from soy in February, according to ANP.

That would drive up prices for soy, raising production costs for refineries, Keller said. “Some producers may not be able to deliver” their product “under those conditions.”BLOOMBERG.

Urgente24 reported 8 / 11 that negotiations were between the producers and the government to unfreeze the internal value of biodiesel derived from soybean (see related). However, the conflict would come to an end for the pressures of the association that brings together workers in the sector.

Biodiesel.com.ar site reported, the update of prices was rushed by a demonstration of the Union of Petroleum private gas and biofuels San Lorenzo, Santa Fe, which warned of the effect of this freeze on jobs.

“It is the role of union leaders to defend the workers, the union is the only
tool that workers have to enforce their rights, “said Ruben Perez, secretary general of the union, who at the situation of the sector had said that SMEs are planning advanced suspensions and holidays for staff. “We prepared all the logistics to make roadblocks,” he threatened.

But after a meeting with the national government with De Vido and Javier Urquiza coordinator of the National Biofuels Program of the Ministry of Federal Planning, Public Investment and Services, an agreement was reached.

“We made it clear that defending the workers, there were formal commitment from that in 10 days will fix the problem and fixed the prices of biofuels for oil companies, which as so far not been published to increase the price of soybeans , the companies lost about $ 30,000 “was what he said the unionist.

Thus, the price is set at $ 3,920 to $ 4,200 in November and December. Currently the price is $ 3,769 a tonne, equivalent to 1,136 liters, for the domestic market catering to oil companies.

Exports grow

Biodiesel exports between January and October this year accumulated a total of U.S. $ 994 million, a 37.8% higher than those recorded in 2009, even though the court did not apply to diesel oil required for domestic consumption, implemented by the Law 26.093 .

At this rate, exports of biofuel end the year at around U.S. $ 1,200 million, which would be above the value of exports of gas oil, gasoline and fuel oil.

During the meeting of the value chain of the Biofuels organized by the Argentina Association of Biofuels and Hydrogen, is recalled that the industry’s installed capacity is 2 million tonnes of production and new investment grows up.

Speaking of the prospects for biofuel production, the engineer Fernando Peláez anticipated that in 2010, are being exported one million tons of biodiesel, plus the placement of 300 thousand tons in the domestic market.

The mandatory cut gas oil to biodiesel began the first day of 2010 with five percent in the aggregate to fossil fuel equivalent to about 600 thousand tons of biodiesel.

This summer, the cut was extended to 7% given the installed capacity of the manufacturing industry and domestic market needs.

Globally, Argentina ranks fourth in the production of biodiesel after Germany, France, and close to Brazil.

But, it is estimated that the leadership in the production and export of biodiesel for Argentina is in full expansion phase with a potential market in the world where demand is growing.

“Argentina’s biodiesel industry will have a sustained growth in the dissertation Peláez ventured.

Source Urgente 24

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SAN NICOLAS, Argentina, Aug 27 (Reuters) – An Argentine company opened on Friday the country’s first factory to make biodiesel from algae, hoping to use pond scum as a replacement for soy in making biodiesel as part of a push for renewable energy.

Argentina is the world’s top exporter of soyoil, but using the edible oil to make fuel is controversial because it cuts into food supplies.

Oil extracted from algae is also seen as an attractive alternative to soyoil and other vegetable oils because it does not use land that could be used for food crops and can absorb carbon dioxide from power plants or factories.

The oil-extraction process also produces a protein-rich paste, which is edible.

“We’re not competing with the food supply but generating food, at a low cost and helping the environment because algae grow fast and trap carbon dioxide,” said Jorge Kaloustian, president of Oilfox S.A., the company that owns the plant northeast of Buenos Aires.

The Oilfox plant’s feedstock is currently 90 percent soyoil and 10 percent algae oil, but the company hopes to eventually depend entirely on algae, which can grow in seawater and even contaminated water.

The algae, which is grown in tanks inside greenhouses, produces a green oil in the photosynthesis process. It grows fast and can duplicate its weight several times a day.

“Algae can get a much higher yield per acre than say soybeans,” said John Williams, spokesman for the Algal BioMASS Association, a trade organization that groups companies involved with developing algae biofuels. “It can produce more than 10 times more fuel per acre than soybeans.”

Some researchers say algae-based fuel would be too costly to produce commercially, but plants that use algae oil have sprouted everywhere, from Australia to China as companies bet on growing demand for renewable fuels.

Exxon Mobil Corp (XOM.N: Quote) last year announced a $600 million investment over the next five years to develop biofuel from algae. [ID:nN14161812]

Kaloustian said the new Oilfox biodiesel plant is the first of its kind in Latin America, and that it is cost effective, partly because the electricity it uses is generated from biogas that comes from sewage waste and compost is fed to the algae to encourage growth.

Through a deal with a JP Morgan-owned company, the carbon dioxide emissions that are pumped into the algae greenhouses from a nearby power plant will eventually be sold as bonds in the carbon market, Kaloustian said.

Oilfox has also signed an agreement with YPF (REP.MC: Quote)(YPFD.BA: Quote), the country’s biggest energy firm, to produce 50,000 tonnes of biodiesel per year. Under Argentine law, energy companies will have to blend diesel with 10 percent biodiesel by year’s end. [ID:nN01138775]

“There’s great enthusiasm for producing renewable energy in Argentina because we have the material needed to make the blend which is soyoil,” Kaloustian said. “We made a bet on using soyoil with a bit of algae, but one day, it will all be algae.” (Writing by Luis Andres Henao; Editing by Helen Popper and Eric Beech).

By Luis Andres Henao

Source: Reuters

The grain-processing plant will be located just north of Rosario, the main agro-industrial hub in Argentina, which is the world’s largest supplier of soymeal and soyoil.

The plant will have “the capacity to generate its own energy and a port for exports of beans and their derivatives,” Molinos (MOL.BA) said in a statement sent to the Buenos Aires Stock Exchange.

The biodiesel producer Renova, in which the three firms have an equal stake, will build the plant.

Molinos, one of Argentina’s main agricultural and food firms, is controlled by local businessman Gregorio Perez Companc. Oleaginosa Moreno Hermanos is indirectly owned by commodities trader Glencore [GLEN.UL]. (Reporting by Jorge Otaola; writing by Alexandra Ulmer; editing by Jim Marshall).

SOURCE: REUTERS

Soybean, one of the most important global sources of protein and oil, is now the first legume species with a published complete draft genome sequence. The sequence and its analysis appear in the January 14 edition of the journal Nature.

The research team comprised 18 institutions, including the U.S. Department of Energy Joint Genome Institute (DOE JGI), the U.S. Department of Agriculture-Agricultural Research Service (USDA-ARS), Purdue University and the University of North Carolina at Charlotte. The DOE, National Science Foundation, USDA and United Soybean Board supported the research.

“The soybean genome’s billion-plus nucleotides afford us a better understanding of the plant’s capacity to turn sunlight, carbon dioxide, nitrogen and water, into concentrated energy, protein, and nutrients for human and animal use,” said Anna Palmisano, DOE Associate Director of Science for Biological and Environmental Research. “This opens the door to crop improvements that are sorely needed for energy production, sustainable human and animal food production, and a healthy environmental balance in agriculture worldwide.”

With the soybean genetic code now determined, the research community has access to a key reference for more than 20,000 legume species and can explore the extraordinary evolutionary innovation of nitrogen-fixing symbiosis that is so critically important to successful agricultural crop rotation strategies.

Jeremy Schmutz, the study’s first author and a DOE JGI scientist at the HudsonAlpha Institute for Biotechnology in Alabama, said that the soybean sequencing was the largest plant project done to date at the DOE Joint Genome Institute. “It also happens to be the largest plant that’s ever been sequenced by the whole genome shotgun strategy—where we break it apart and reassemble it like a huge puzzle,” he said. Of the more than 20 other plant genomes taken on by the DOE JGI, those already sequenced include the black cottonwood (poplar) tree and the grain sorghum, both targeted because of their promise as biomass feedstocks for biofuels production.

“This is a milestone for soybean research and promises to usher in a new era in soybean agronomic improvement,” said co-author Gary Stacey, Director, Center for Sustainable Energy and Associate Director and National Center for Soybean Biotechnology, University of Missouri. “The genome provides a parts list of what it takes to make a soybean plant and, more importantly, helps to identify those genes that are essential for such important agronomic traits as protein and oil content.”

Soybean, one of the most important global sources of protein and oil, is now the first legume species with a published complete draft genome sequence.

From the sequence analysis, Stacey said that he and his colleagues have identified more than 46,000 genes of which 1,110 are involved in lipid metabolism. “These genes and their associated pathways are the building blocks for soybean oil content and represent targets that can be modified to bolster output and lead to the increase of the use of soybean oil for biodiesel production.”

While biodiesel from soybean oil represents a cleaner, renewable alternative to fossil fuels with desirable properties as a liquid transportation fuel, there simply is not enough oil produced by the plant to be a competitive gasoline on a gallons-of-fuel yield per acre. The availability of the soybean genome may provide some key solutions. “We can now zero in on the control points governing carbon flow towards protein and oil,” said Tom Clemente, Professor, Center for Biotechnology, Center for Plant Science Innovation at the University of Nebraska, Lincoln. “With the combination of informatics, biochemistry and genetics we can target the development of a soybean with greater than 40 percent oil content.”

The availability of the soybean genome sequence has accelerated other soybean trait discovery efforts as well. For example, researchers have used the sequence to zero in on a mutation that can be used to select for a line that has lower levels of the sugar stachyose, which will improve the ability of animals and humans to digest soybeans.

In another effort, by comparing the genomes of soybean and corn, a single-base pair mutation was found that causes a reduction in phytate production in soybean. Phytate is the form in which phosphorous is stored in plant tissue. Because phytate is not absorbed by the animals that eat the feed, the unabsorbed phytate passes through the gastrointestinal tract, elevating the amount of phosphorus in the manure. Limiting phytate production in the soybean could reduce a major environmental runoff contaminant from swine and poultry waste.

Of additional importance for soybean farmers is that the genome sequence has provided access to the first resistance gene for the devastating disease Asian Soybean Rust (ASR). In countries where ASR is well established, soybean yield losses due to the disease can be as high as 80 percent.

Provided by DOE/Joint Genome Institute

Source: Physorg

The president of the National Agency of Investment Developments, Beatriz Nofal and Jorge Piwko, director of Biodiesel del Plata, announced this morning the inauguration of a biodiesel plant using used vegetables oils.Â

Associated to spanish capitals, Piwko formed the company of renewable energy Ricard Set and with a total investment of u$s1,5 million the plant was built to produce biodiesel with an installed capacity of 1.200 monthly tons of biodiesel and 500 tons of industrial glycerine to 85% concentration, destinated to the export. It is forseen that the commercial production will begin in June.Â

Biodiesel del Plata is developing a plan of biodiesel elaboration starting from the gathering of used vegetables oils that will involve non governmental organizations, public and private schools, and beneficiaries of social plans and street collectors, creating ecological conscience and collaborating in the achievement of a clean and sustainable development in time.Â

This way, this initiative contributes doubly to reduce the levels of contamination. On one hand, because the vegetable oils of domestic use when they are degraded and poured by the drainages, they form films in the water that impede their oxygenation and they complicate the correct purification of the residual waters.Â

On the other hand, the biodiesel possesses aptitude to replace the fossil fuels in any conventional diesel motor providing significant reductions in the emanation of particles and of carbon monoxide in comparison with the petroleum diesel.Â

Also, their biological cycle in the production and the use reduces approximately in 80% the emissions of carbonic anhydride and almost 100% those of sulfur dioxide; and their combustion diminishes in 90% the quantity of total not burned hydrocarbons, and between 75-90% in the aromatic hydrocarbons.Â

ProsperAr will facilitate the access of Biodiesel del Plata to the support programs for the patenting that the national Government ahead is carrying out in the area of Science and Technology as well as the contacts with the authorities of investments of the county of Buenos Aires and their participation in commercial missions and international fairs.Â

Source:Infobae