Argentina increases biodiesel mandate

By Bryan Sims | July 13, 2010
Posted July 13, 2010

A resolution was signed in Argentina this month to lift the required mix of biodiesel in all diesel fuel to B7 from B5. The increased mandate to a B7 blend will officially begin in September, according to Carlos St. James, president of the Argentine Renewable Energies Chamber, or Camara Argentina de Energias Renovables (CADER).

"Argentina decided to quickly expand to a B7 [blend] for a combination of reasons," St. James told Biodiesel Magazine. "On the one hand, until last year, Argentina imported about 5 percent of its diesel needs, typically from Venezuela, which has a particularly high sulfur content. The B5 [mandate] eliminates the need to import this diesel."

In May, CADER published a report entitled, "State of the Argentine Biofuels Industry: Launching of the Domestic Biodiesel and Ethanol Market," which indicated Argentina having an installed capacity of approximately 2.4 million tons (720.5 million gallons) annually originating from 19 producing facilities. In 2009, Argentina exported 1.2 million tons per year of production, almost all of it to Europe.

"Beginning in 2010 the B5 mandate began along with the startup of considerable small and medium-sized plants to supply the domestic market," St. James said. "Given the abundant installed capacity, meeting the B7 [mandated blend] is easy."

With a B7 mandate now in place, St. James said he's optimistic that Argentina will subsequently increase to a B10 in-country blend by the end of the year, "but a lot of negotiating needs to happen with the automotive industry first," he said.

In related news, Brazil, which has required an in-country B5 biodiesel blend since the beginning of this year, is mulling over whether or not to raise the blend requirement to B10 or possibly to B15. The increase to B5 was originally planned for 2013. Biodiesel blends in Brazil became mandatory in early 2008, followed by a raise in blend levels from B2 to B3 in July of the same year and from B3 to B4 in 2009.

According to a USDA Foreign Agricultural Service report released in April, Brazil currently has 64 biodiesel plants in operation with an estimated 4.6 billion liters (1.22 billion gallons) of production capacity annually. Production will reach approximately 2.35 billion liters in 2010 under the B5 blending mandate based on estimated consumption levels.

Additionally, the report indicated that Brazil's soy oil exports from January through May were down by approximately one-third from last year due mostly to growing demand from biodiesel producers.
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