Biodiesel To Cut Argentine Soyoil Sales

Increasing Argentine domestic biodiesel use will cut the country’s soyoil exports in 2010, Hamburg-based oilseeds analysts Oil World forecast Feb. 9.

If Argentine government plans for five per cent biodiesel content in fossil diesel are implemented, coupled with compulsory use of biodiesel for electricity generation, this would create annual demand for 860,000 tonnes of biodiesel, largely made from soyoil, Oil World estimates.

“As a result, larger quantities of soyoil will be used domestically at the expense of soyoil exports,” it said.

Argentina is the world’s largest soyoil exporter, followed by Brazil and the United States.

Under current plans, large-scale Argentine domestic biodiesel consumption could start in late March 2010 and reach about 72,000 tonnes a month this year, it said.

The country’s huge biodiesel industry currently has estimated capacity of 2.5 million tonnes annually which is likely to rise to 3.6 million to 3.7 million tonnes by the end of 2010, it said.

Negligible domestic consumption means Argentine biodiesel output has been virtually all exported with the help of tax breaks, causing friction with European green fuel producers.

Increased Argentine biodiesel consumption could start competition between the domestic and export markets, it said, although output capacity would still be below domestic demand.

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