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Great demand in Europe pushes up rapeseed, biofuel prices - Latvian assoc

Great demand in Europe pushes up rapeseed, biofuel prices - Latvian assoc
(c) 2011 Baltic News Service

The high demand for rapeseed in Europe has recently pushed up the prices for rapeseed and also biofuel in the world, Daumants Znatnajs, President of the Latvian Biofuel Association, told BNS.

He said that the requirement about mixing fossil fuel with 10 percent of bio-additives in 2020 had raised the demand for rapeseed in the EU member states and also pushed up the prices for rapeseed and biofuel. The EU is offering a very high price for rapeseed and buying them up in Belarus, Russia and Ukraine, which also supply rapeseed to Latvia, Znatnajs said.

The total capacity of the biofuel plants in Latvia is some 290,000 cubic meters, and last year they worked only at one-fourth of this capacity as the biofuel producers were short of the working capital, the association head said.

The biofuel plants are not standing idle at the moment but the current stock would not last long and some of the plants in Latvia might stop production, if they failed to buy more rapeseed, Znatnajs said.

As the production capacities are sufficient, Latvian farmers should be growing more rapeseed and the country should be selling biofuel, not just rapeseed or rapeseed oil, he suggested. It would also be good for the Latvian state as the producers would be buying rapseed from local farmers.

Fossil fuel price is rising and biofuel price would not catch up with the price for fossil fuel, the association head said.

The biofuel output in Latvia last year was around 70-75 thousand cubic meters or roughly the same as in 2009. O fall biofuel made in Latvia in 2010, some 30-35 percent were sold on the domestic market, which is a significant growth from 10 percent in 2009.

According to the information from the Economics Ministry, the share of biofuel accounted for 0.14 percent of total fuel consumption in Latvia in 2007, for 0.17 percent in 2008 and for 0.48 percent in 2009.

Riga newsroom, +371 6708 8606, eko_zinas@bns.lv

Date:  23.01.2011

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