Linu Mathew Philip Centre for Trade and Development (Centad), New Delhi, India Regional Dialogue in Biofuels in Asia 9-10 November 2009
Relevance of Biofuel in the new context Trends Production Consumption Trade Price Economics of Biofuel Future Prospects
Growing rural-urban divide Highly volatile crude oil prices Demand for growth Energy Option Green fuel and climate change adaptation Next
Biofuel can provide (UNEP Report 2009) Connectivity Renewable energy Multiple opportunities for additional income Rural development Access to energy Transport infrastructure Technology interface
Next
Renewable Energy share of GFEC (2006) Next
Comparison of Biofuel with fossil fuel for transport differentiated by phases Next
EU Leads in the Biodiesel production More than 50 percentage of the biodiesel production US also considerably expanding it growth (14% pa) High growth in biodiesel production Argentina Indonesia Ethanol USA producing more than 50 percentage EU also growing at a fast pace (around 10 % pa)
US Biofuel Consumption highest with 47% Followed by Brazil with 30 percentage Ethanol Consumption in the world have been over 10 billion gallons Increasing at the rate of 5 percentage pa Biodiesel consumption 4 billion gallons Increasing at faster rate
Ethanol price increasing ($1.76/gl) Biodiesel price price increased to $5 Biofuel prices Joint demand with crude oil Move together Price have been linked to imports of key countries
6 Trend in Biofuel prices 5 4 $ per gallon 3 Ethanol Brazil Ethanol US Biodiesel Europe Biodiesel World 2 1 0 Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 FAPRI 2009
The biofuels an increasing trend Volume increased Ethanol ~1.5 billion gallons Biodiesel ~1 billion gallons Major gainers East asia countries on Biodiesel Brazil and China on Ethanol
Ethanol Trade 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (Million Gallons Net Exporters ) Brazil 1,165 1,169 1,466 1,820 2,124 2,395 2,818 3,268 3,647 4,236 4,896 China 52 31 13-9 -21-35 -44-54 -67-78 -91 Total Net Exports * 1,216 1,201 1,479 1,820 2,124 2,395 2,818 3,268 3,647 4,236 4,896 Net Importers Canada 165 260 312 364 412 460 503 550 599 657 711 European Union 318 318 352 401 436 467 494 523 559 586 617 India 0 23 59 90 107 120 130 139 153 163 172 Japan 149 196 234 273 308 343 377 412 447 481 516 South Korea 81 104 132 154 175 195 215 236 257 276 297 United States 436 195 250 353 454 528 772 1,037 1,211 1,605 2,070 ROW 67 104 140 176 212 247 282 317 353 388 423 Total Net Imports * 1,216 1,201 1,479 1,820 2,124 2,395 2,818 3,268 3,647 4,236 4,896
Biodiesel Trade 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (Million Net Exporters Gallons) Argentina 264 320 188 218 239 253 262 268 270 271 270 Brazil -1 167 69 103 127 144 154 160 162 161 157 Indonesia 102 117 149 166 173 171 165 155 143 128 112 Malaysia 51 47 48 48 48 48 48 47 47 47 47 United States 353 322 284 244 199 178 174 178 184 187 184 Total Net Exports * 771 974 737 779 785 794 803 809 806 794 769 Net Importers European Union 300 487 253 296 304 313 323 329 327 315 291 Japan 4 19 17 16 15 15 15 15 15 14 14 ROW 465 468 468 467 466 466 466 465 465 465 464 Total Net Imports * 771 974 737 779 785 794 803 809 806 794 769
Rising prices of crude oil has made the biofuel more competitive Technology critical to the production Subsidies essential Cost of Biofuel Production (cost per barrel in USD) Year Crude Oil Biodiesel Bioethanol 2006-08 138 76 113 Note: One barrel = 159 litres Source: http://www.nfuonline.com/x9764.xml (assessed 9 June 2008)
Biofuel and EGS Mix up between Agricultural and NAMA Climate Change dimension Acceptance Compliance Stimulate a fresh investment Regional integration Supply chain of biofuel Stimulate flow of agricultural products Asia supply set to increase with technology and investment
Upward trend With Climate Change EGS Supply and demand expected to converge Food prices and Biofuel Higher growth and need for transportation Technology will remain key
Biofuel critical for bridging rural-urban divide Integrated Approach of Food and Energy Security Imports will be push factor in biofuel energisation Subsidies will remain a bone of contention in Biofuel May not restrict expansion of biofuel Biofuel and Environmental degradation Additional Research and Development needed Certification and regulation challenges Technology and investment flows