Positive Environment News

INTERVIEW - Food Industry Calls for Biodiesel Alternatives

Date: 04-Apr-06
Author: Anna Mudeva

Big European food makers sucha as Anglo-Dutch Unilever face fierce competition for rapeseed oil supplies from biodiesel makers as tax incentives and high crude oil prices stimulate fuel production.

"Policy makers have to recognise the problem. We brought it to their attention and it's now up to them to balance the situation," Inneke Herreman, secretary general of the International Margarine Association of the Countries of Europe (IMACE), told Reuters.

"The only way to improve things for us is to develop biodiesel alternatives -- introduce ethanol...develop second generation biofuels made from waste or wood pulp that are not threatening food needs," she said.

The European Union wants biofuels derived from renewable organic resources to make up 5.75 percent of transport fuels by 2010 to reduce the bloc's dependence on imported energy and cut greenhouse gas emissions.

High crude oil prices have made biofuels, mainly biodiesel produced from rapeseed and other oils, even more attractive in the EU, with tax incentives in some countries stimulating output of green fuels.

EU biodiesel capacity is expected to jump 50 percent to some 6 million tonnes by end-2007.

About 40 to 60 percent of Europe's rapeseed harvest was used for production of biodiesel in the past two years, according to the vegetable oil industry.

Fierce competition for rapeseed oil -- the product preferred by biodiesel makers because of its availability and quality -- lifted prices by over 100 euros a tonne last year and left some food producers scrambling to secure their needs.

Herreman said the margarine industry, whose biggest member is Unilever, was worried about whether there would be enough vegetable oil in the long term given the growing race in Europe and other parts of the world to expand biofuel capacity.

"The other side keeps expanding further as Europe is trying to reduce dependence on imported energy," she said.

Margarine producers are the biggest users of rapeseed oil in the food industry.

The EU had only recently recognised that the boom in biodiesel production was affecting other industries, Herreman said.

"We did not make decision makers aware about the problem because we were ourselves not aware that it will have such an immense impact," she said.

© Thomson Reuters 2006 All rights reserved

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