According to a report by the Argentine Renewable Energies Chamber (CADER) entitled "State of the Biodiesel Industry 2010”, the South American country went from being fifth in the world biodiesel production tables in 2009 to the current position of fourth, after surpassing the United States.
In 2010, biodiesel production in Argentina is estimated at 1,900,000 tonnes, 51% higher than in the previous period, with sales totalling $ 1.9 billion (€1.4 billion).The CADER study shows that consequently, Argentina now occupies fourth slot behind Germany, France and Brazil) and argues that the sector’s plants in Argentina have sufficient installed capacity to produce an estimated 2,487,000 tonnes. Projections show that by the end of 2011, demand for local biodiesel could exceed 3 million tonnes, a situation that could encourage new investment to boost supply.
Biggest plant in world
CADER also states that the world's largest plants are in Argentina, with an average production capacity of 108,000 tonnes each, compared to 89,000 tonnes in Europe and 70,000 tonnes in Brazil.
With Cargill and Unitec Bio recently announcing they are to construct plants with production outputs of 240,000 tonnes and 220,000 tonnes per annum, respectively, the nation's total biodiesel production capacity will reach 3,084,000 tonnes a year in late 2011, representing an increase of almost 14% compared with 2010.
CADER explains that the mandatory biodiesel target imposed by the Government, the GENREN tender process, and the decision to pay electricity utilities double what they receive if they replace fuel fossil with biodiesel have all contributed to biodiesel's successful ramp-up.
According to the report, "only two world biodiesel markets have been shown to be overwhelmingly successful in recent years: France and Argentina". This is because European countries generally have excess capacity and a lack of raw materials, while the US presents an excessively fragmented industry characterised by very small plants, which are not profitable without significant subsidies.
CADER also reveals that elsewhere, biodiesel industry growth has been hampered: in Australia, by a lack an adequate regulatory framework; in Malaysia, because the industry uses palm oil, which the world looks on with suspicion because it is food crop; and in Brazil, because an inefficient industry is having a negative impact on prices.
The Argentine Renewable Energies Chamber is a non-profit trade association that represents the biofuels industry in Argentina as well as the renewable energies sectors such as wind, solar and hydro. It is the premier coordinating body, interacting with a broad range of players from the public and private sectors as well as academia.
