Navigation Links
Government Mandates Create Guaranteed Market for Bio-Fuel, Says Frost & Sullivan

SINGAPORE, June 22 /PRNewswire/ -- Globally, the largest market for bio-diesel is the European Union. The EU's commitment to achieve a reduction in CO2 emissions by 8.0 percent between 2008 and 2012 has resulted in the setting of a target of 5.75 percent bio-fuels of all transportation fuel by December 2010 and 10 percent by 2020. Though the United States is a smaller market, it is witnessing rapid growth in terms of both new bio-diesel capacities coming on-stream as well as increased consumption of bio-diesel. Markets in Latin America, especially Argentina and Brazil, are also developing strongly.


While the SEA region is still a nascent market for bio-diesel, there are several strong drivers of growth for both increased supply as well as demand. Although targeting export markets is a primary objective for producers in some countries, especially Malaysia and Singapore, some SEA countries are developing domestic markets.

According to Frost & Sullivan's Asia Pacific Research Analyst of Chemicals, Material & Food Practice, Ratneswary Balasingam, bio-diesel is clearly viewed by most governments in the region as a way of reducing air pollution and contributing to the reduction of greenhouse gas emissions; to stimulate domestic agriculture; and most importantly, in many cases, to reduce oil imports and improve fuel security. For the latter two reasons, most countries aim to be self-sufficient in both feedstock and production.

"Despite these drivers, there is generally a low level of consumer awareness regarding bio-diesel and its benefits. In many cases, oil companies remain hesitant about offering bio-diesel blends. Also, unimaginable feedstock prices and lack of government initiatives in some countries, in terms of establishing favorable tax incentives for bio-diesel supply and uptake, is restraining market growth," she added.

In 2008, SEA countries had a total production capacity of above 2.6 million tons. However, most companies were producing at only 10 to 50% of their capacity due to high feedstock prices and uncertainty in government mandates during the economic downturn.

"To address this, some governments have introduced compulsory mandates for bio-fuels, which will create a guaranteed market, although the blending percent is generally low when compared to the EU market," said Balasingam.

In Malaysia, the government will implement the blending of 5% palm-based methyl ester with fossil diesel beginning February 2010 whereas Thailand has mandated B2 on February 2008 and plans to increase to B5 by 2011 which will require almost 4 million liters/day of bio-diesel.

The Indonesian government introduced a mandate in November 2008 for a blend of 1% palm-based bio-diesel in transportation fuels and a blend of 2.5% and 0.25% palm-based bio-diesel for industry and power plant uses respectively. This mandate will be increased to between 2.5% to 3% for transportation, 5% for industry and 1% for power plants by 2010.

The government of Philippines has placed a 2 percent bio-diesel mandate, which took effect in February 2009. The mandate will increase bio-diesel requirement from 133 million liters this year to 160 million liters by 2014.

"In the past four years, the industry witnessed an increase in bio-diesel investments that has resulted in a staggering 623 percent jump in aggregate domestic production capacity to the current 383 million liters from 53 million liters in 2005. The Philippines Government hopes to increase the bio-diesel mandate to B3 by 2011," said Balasingam.

She continued, "The increasing number of European- and US-based companies making significant investments in bio-diesel projects in SEA confirms the interest in the industry. In addition, the successful public listing of some bio-diesel producers in this region has reinforced investor confidence in the feasibility of the bio-diesel business model in the region."

Overall, the drivers for the export of bio-diesel produced in the SEA countries, especially for Malaysia and Singapore, that are focusing on export markets such as the European Union are expected to remain strong in the short and medium terms.

"The substantial increase in bio-diesel production capacity in the region is a clear sign of the industry going beyond its niche status to becoming a mainstream export revenue generator and a strategic part of government-driven environment initiatives domestically. However, domestic consumption will not only depend on the pace of government legislation, but also on the level of enforcement and compliance, in relation to blending targets and supply, achieved in each country," said Balasingam.

She continues, "A growing trend is seen as most SEA countries aims to increase the blend requirement for bio-diesel. Focus into local markets and meeting National Bio-fuel Policy requirements will be the future outlook for bio-diesel within the region. Support from local governments, through either subsidies or tax exemption, will in turn spur growth for the development of bio-diesel."

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best in class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 35 offices on six continents. To join our Growth Partnership, please visit


    Donna Jeremiah
    Corporate Communications - Asia Pacific
    P: +603 6204 5832
    F: +603 6201 7402

    Carrie Low
    Corporate Communications - Asia Pacific
    P: +603 6204 5910

SOURCE Frost & Sullivan
Copyright©2009 PR Newswire.
All rights reserved

Related biology technology :

1. Sundias Animal Facility Passed Client and Government Inspection
2. PTC Therapeutics Receives $2.6 Million in Government Grants
3. Neogen Partners With Chinese Government
4. GeneNews to conduct joint project funded by MYR 5 million grant from Malaysian government
5. Quest Diagnostics Finalizes Previously Announced Settlement With Government Related to Test Kit Subsidiary Closed in 2006
6. Canadian Government Announces Funding for Leading Biotechnology Firms Project
7. Mental Stimulus Package: Government Officials who Forgot to Pay Taxes Will Receive Free Memory-boosting Supplement
8. Modigene Awarded Second-Year Grant by Israeli Government to Support Development of Its Longer-Acting Human Growth Hormone
9. Cain and Associates Launches Government Audit Protection (GAP) Service
10. PRC Government Grants High-Tech Status to AOBO Subsidiaries
11. Maureen Mo Zilly Joins the Varian Medical Systems Government Affairs Team as Director, Federal Affairs
Post Your Comments:
(Date:11/30/2015)...  HUYA Bioscience International, the leader in accelerating global ... today announced it has signed a Memorandum of Understanding ... collaboration between KDDF and HUYA with the ultimate goal ... for the global market. China,s ... innovative preclinical and clinical stage compounds. The company advances ...
(Date:11/30/2015)...  Northwest Biotherapeutics (NASDAQ: NWBO ) ("NW Bio"), ... for solid tumor cancers, announced today that the Board ... the Company welcomes Neil Woodford,s call for ... internet report on NW Bio.  The Company,s Board is ... stated, "We agree with Mr. Woodford that, at ...
(Date:11/27/2015)... United Kingdom , Nov. 27, 2015 /PRNewswire/--  Mallinckrodt ... biopharmaceutical company, announced today that it has closed the ... (CMDS) business to Guerbet (GBT- NYSE Euronext) in a ... operations encompassed four manufacturing facilities and a total of ... 75 in the St. Louis ...
(Date:11/26/2015)... England , November 26, 2015 ... innovative medical device company specializing in imaging technologies, announced today ... European Commission as part of the Horizon 2020 European Union ... carry out a large-scale clinical trial in breast cancer. ... (Logo: , --> --> ...
Breaking Biology Technology:
(Date:10/27/2015)... In the present market scenario, security is ... industry verticals such as banking, healthcare, defense, electronic gadgets, ... for secure & simplified access control and growing rate ... of bank accounts, misuse of users, , and so ... laptops, and smartphones are expected to provide potential opportunities ...
(Date:10/26/2015)... October 26, 2015 ... adds Biometrics Market Shares, ... as well as Emerging Biometrics Technologies: ... to its collection of IT and ... . --> ...
(Date:10/23/2015)... 23, 2015 Research and Markets ( ... Voice Recognition Biometrics Market 2015-2019" report to their ... The global voice recognition biometrics market to grow ... --> --> The report, ... based on an in-depth market analysis with inputs from ...
Breaking Biology News(10 mins):