EU biodiesel production declines in 2011

2011-10-21 18:04:14

Although biodiesel production registered moderate growth in 2010, figures disclosed this week have now shown a decline for the first in registered history.

While 2010 EU biodiesel production registered a 5.5 per cent increase compared to the previous year, reaching a level of 9.57 million tonnes, the forecasts for 2011 show a reduction in European production compared to the same time last year.

In addition, the 2010 increase remains low compared to growth rates registered in 2009 (17 per cent) and 2008 (35 per cent). The first quarter of 2011 shows a reduction of domestic European production.

In 2010 Spain confirmed its position as the third largest European biodiesel producer, ahead of Italy, which saw a slight decline in production compared to 2010. Germany and France remain by far the leading biodiesel producing nations.

As of July 2011, European biodiesel production capacity was at 22 million tonnes. The number of existing biodiesel facilities stood at 254, slightly up from 2009 due to the start of a few new production units. This industrial base is the result of investments in biodiesel production planned before 2007 in order to meet ambitious objectives for biofuels consumption given by EU authorities.

While EU biodiesel capacity utilisation stands at 44 per cent for the first two quarters of 2011, and for the first time in registered history, the entire European production has slightly decreased year-on-year.

European Biodiesel Board estimates show that the overall production in the EU decreased in Q2 2011. Increased imports from third countries such as Argentina and Indonesia, as well as circumvention measures from North America are the most likely cause.

The important contribution of biodiesel to the EU’s 2020 transport target has been unambiguously recognised by Member States in their National Action Plans submitted under the Renewable Energy Directive 2009/28.

According to member states forecasts, biodiesel will fulfil no less than 66 per cent of the 2020 target, translating into a 24 million tonnes, as long as the European industry introduces the right legislative tools which ascertain investment and economy of scale. Biodiesel producers currently face several international trade and regulatory challenges, which could not only strengthen the declining trend but also have a concerning impact on the economy.