Even though the world is embracing biofuels in a big way, this year’s biofuel production may not touch the earlier predicted level.
The world was expected to produce around 1.5 million barrels of biofuel per day this year but that may come down to around 1.35 million barrels per day.
The May forecast was that the world will produce 1.5 million barrels per day, the International Energy Agency said.
However, despite the lower estimate, 2008 biofuel production is still set to eclipse the IEA’s 2007 biofuels output projection of 1.06 million barrels per day.
The downward revision was a result of reduced output from European and Asian countries where mandatory blends are being questioned or withdrawn.
The allegation that biofuels’ feedstock needs have driven up food prices and question marks about environmental benefits have led many countries to reconsider planned or existing mandatory blending requirements and subsidies, said the IEA.
However, the IEA estimates future biofuel production growing to 1.95 million barrels per day by 2013, mainly attributable to the expansion of the US ethanol industry. According to the IEA, despite strong growth forecasts in the near term, the biofuels industry is constricted by factors including land availability, infrastructure, vehicles’ ability to take higher blends, and the economics of biofuels production.
Flooding in the US last month could also curtail the country’s corn production and impact ethanol output.
