POC Conference, March 8 th- 10 th  2009 Developed By Frost & Sullivan Consulting Team Frost & Sullivan www.frost.com  The ...
Confidential to Frost & Sullivan  Market will continue to look for ways to grow especially bioethanol – energy security/ p...
Confidential to Frost & Sullivan  Current global situation Frost & Sullivan estimates 20 60 120 <ul><li>Rough year in US <...
Confidential to Frost & Sullivan  Current global situation – interest is waning – ethanol example Source : Biofuels Digest...
Confidential to Frost & Sullivan  Current global situation – interest is waning – biodiesel example Source : Biofuels Dige...
Confidential to Frost & Sullivan  History in perspective 2007-2008 : a confluence of several things at the same time pushe...
Confidential to Frost & Sullivan  …  so what of biodiesel/ biuofuels and their role when profits are so low, with such hig...
Confidential to Frost & Sullivan  What else have we learnt? – biofuels are a political market, and this can be both good a...
Confidential to Frost & Sullivan  What else have we learnt? – biofuels are here to stay – cellulosic ethanol and biodiesel...
Confidential to Frost & Sullivan  What else have we learnt? – clear interest still in biofuels as a whole <ul><li>Interest...
Confidential to Frost & Sullivan  What else have we learnt? – algae is main area of interest from a feedstock point of vie...
Confidential to Frost & Sullivan  Outlook : “choppy” history will repeat itself again, and prices are expected to rise esp...
Confidential to Frost & Sullivan  Outlook : crude oil prices starting to inch back up...
Confidential to Frost & Sullivan  … our outlook for 2010, esp. 2011/2012 We could get to back  3500 RM  quicker than we th...
Confidential to Frost & Sullivan  … our outlook for 2010, and esp. 2011/2012 We will likely see super spikes again……………. W...
Confidential to Frost & Sullivan  What we also said at the end of the POC conference, 2007… is still valid! “ We should no...
Confidential to Frost & Sullivan  … but more importantly what of 5, 10, 20, 50 years down the line? Can oils keep up with ...
Confidential to Frost & Sullivan  In conclusion :  Biofuels are here to stay BUT....... <ul><li>Need consistent and co-ord...
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The Future of Biodiesel in Uncertain Times: Outlook on Biodiesel & Vegetable Oils for 2010 & Beyond

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Frost & Sullivan Outlook on Biodiesel & Vegetable Oils for 2010 & Beyond.

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The Future of Biodiesel in Uncertain Times: Outlook on Biodiesel & Vegetable Oils for 2010 & Beyond

  1. 1. POC Conference, March 8 th- 10 th 2009 Developed By Frost & Sullivan Consulting Team Frost & Sullivan www.frost.com The Future of Biodiesel in Uncertain TImes Outlook Biodiesel & Vegetable Oils for 2010 & Beyond
  2. 2. Confidential to Frost & Sullivan Market will continue to look for ways to grow especially bioethanol – energy security/ politics will be a key drivers behind this Frost & Sullivan estimates Millions of Litres BIOETHANOL 1 20 40 20 60 120 BIODIESEL 2000 2000 2010 2020 2020 2010
  3. 3. Confidential to Frost & Sullivan Current global situation Frost & Sullivan estimates 20 60 120 <ul><li>Rough year in US </li></ul><ul><li>Biodiesel at 2006 levels </li></ul><ul><li>180 plants – 15% capacity utilization </li></ul><ul><li>$1 Tax credit gone since end 2009 </li></ul><ul><li>How many of the plants are in operation in Malaysia and Indonesia? </li></ul><ul><li>Had a good 2008 (7.7 M MT) – protectionism played a role. </li></ul><ul><li>276 plants, 20 M MT capacity </li></ul><ul><li>Argentina produced 880 million litres in 2010 </li></ul><ul><li>Brazil 1.8 Mn Tonnes, 20% blend by 2015 in major cities </li></ul>
  4. 4. Confidential to Frost & Sullivan Current global situation – interest is waning – ethanol example Source : Biofuels Digest <ul><li>Ethanol - down 70 percent from a high point realized in 2006, and showing a decline in 2009 despite a slight surge in the second half of the year. </li></ul>
  5. 5. Confidential to Frost & Sullivan Current global situation – interest is waning – biodiesel example Source : Biofuels Digest <ul><li>Biodiesel is down nearly 80 percent since a high realized in 2005, and interest in the search term declined throughout the year. </li></ul>
  6. 6. Confidential to Frost & Sullivan History in perspective 2007-2008 : a confluence of several things at the same time pushed palm prices, and few had to do with palm itself High Crude Oil Price Bad Weather Commodity Price Shift Biofuels Extra Demand Subprime HIGH PRICES!
  7. 7. Confidential to Frost & Sullivan … so what of biodiesel/ biuofuels and their role when profits are so low, with such high vegetable oil prices? Source : FC Stone
  8. 8. Confidential to Frost & Sullivan What else have we learnt? – biofuels are a political market, and this can be both good and bad.
  9. 9. Confidential to Frost & Sullivan What else have we learnt? – biofuels are here to stay – cellulosic ethanol and biodiesel is key. When will it be commercial scale? <ul><li>Biofuel Digest reports that two producers have been able to reduce the cost of production of cellulosic ethanol and algal biodiesel below USD 2.00 per gallon, or 50 cents per litre. </li></ul><ul><li>Cellulosic ethanol </li></ul><ul><li>In Denmark, Novozymes has announced that productivity increases with its new Cellic CTec2 enzymes have brought enzyme costs down to 50 US cents per gallon, and will enable the biofuel industry to produce cellulosic ethanol at a price below USD 2.00 per gallon for the initial commercial-scale plants that are scheduled to be in operation in 2011. This cost is on par with gasoline and conventional ethanol at the current US market prices……. </li></ul>
  10. 10. Confidential to Frost & Sullivan What else have we learnt? – clear interest still in biofuels as a whole <ul><li>Interest in “biofuels” peaked in the late spring of 2008 and dropped by around 70 percent by the end of 2009, but recovered with a spike in early 2010 around the time of the announcements of DOE’s Integrated Bioenergy grant recipients. </li></ul>Source : Biofuels Digest
  11. 11. Confidential to Frost & Sullivan What else have we learnt? – algae is main area of interest from a feedstock point of view, jatropha still garners some attention Source : Biofuels Digest Source : Biofuels Digest <ul><li>Interest in “Algae biofuels” peaked in the summer of 2008, but after declining almost half by the summer of 2009, experienced a surge of interest in the “Summer of algae” that brought it nearly back to pre-global financial crisis highs. </li></ul><ul><li>Jatropha peaked in the summer of 2008, after steady growth 2004-2008, and has declined about 60 percent from that high point, including a steady decline throughout 2009. </li></ul>
  12. 12. Confidential to Frost & Sullivan Outlook : “choppy” history will repeat itself again, and prices are expected to rise esp. in 2011/2012 though watch out for Q3 2010... High Crude Oil Price Bad Weather Commodity Price Shift Biofuels Extra Demand Subprime HIGH PRICES!
  13. 13. Confidential to Frost & Sullivan Outlook : crude oil prices starting to inch back up...
  14. 14. Confidential to Frost & Sullivan … our outlook for 2010, esp. 2011/2012 We could get to back 3500 RM quicker than we think…. Written 1 day ago….
  15. 15. Confidential to Frost & Sullivan … our outlook for 2010, and esp. 2011/2012 We will likely see super spikes again……………. Written 1 day ago….
  16. 16. Confidential to Frost & Sullivan What we also said at the end of the POC conference, 2007… is still valid! “ We should not be debating whether the average for the year will be above or below 2100 RM, ……. it is going to much higher”.
  17. 17. Confidential to Frost & Sullivan … but more importantly what of 5, 10, 20, 50 years down the line? Can oils keep up with these requirements? Food for thought….! Growing population Crops Competing for Land Energy needs Water stress 1 2 3 4
  18. 18. Confidential to Frost & Sullivan In conclusion : Biofuels are here to stay BUT....... <ul><li>Need consistent and co-ordinated Government support </li></ul><ul><li>Low raw material prices </li></ul><ul><li>High energy prices </li></ul><ul><li>“ New” feedstocks </li></ul><ul><li>Advances in technology </li></ul>

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