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 inves
|SOURCE Frost & Sullivan|
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