Oct/Nov 2014 !

Vol 30 No 8
www.oilsandfatsinternational.com

OILSEEDS
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TRANSPORT
Flexitanks: a bag for life
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 T HE B USI NE SS MAG AZ IN E FOR TH E OILS AN D FATS IN D UST RY

CONTENTS

PHOTO: DORAZETT/FOTOLIA.COM
FEATURES
VOL. 30 NO. 8 OCT/NOV 2014
CHINA
EDITORIAL:

Editor: Serena Lim 16 Glycerine market

Tel: +44(0)1737 855066; Fax: +44 (0)1737 855034
E-mail: serenalim@quartzltd.com explodes
Assistant Editor: Charlotte Niemiec
Tel: +44 (0)1737 855157; Fax: +44 (0)1737 855034 USA COVER: SAFFLOWERSEED OIL IS GATHERING INTEREST IN THE
E-mail: charlotteniemiec@quartzltd.com FOOD, BIOFUEL AND OLEOCHEMICAL INDUSTRIES P28

SALES:
20 Eliminating trans fats
Sales Manager: Mark Winthrop-Wallace
Tel: +44 (0)1737 855 114; Fax: +44 (0)1737 855034
E-mail: markww@quartzltd.com TRANSPORT, LOGISTICS, STORAGE
Sales Consultant: Anita Revis
Tel: +44 (0)1737 855068; Fax: +44 (0)1737 855034
E-mail: anitarevis@quartzltd.com
23 Previous cargo rules
change
Chinese Sales Executive: Erik Heath
Tel: +44 (0)1737 855108; Fax: +44 (0)1737 855034 NEWS & EVENTS
E-mail: erikheath@quartzltd.com

PRODUCTION: 24 Flexitanks: a bag for 2 Comment

Production Editor: Nikki Weller life No foreign cap
Tel: +44 (0) 1737 855088; Fax: +44 (0)1737 855034
E-mail: nikkiweller@quartzltd.com
2
PHOTO: WIKIPEDIA.COM

News
CORPORATE:

Vice President: Steve Diprose

Sime Darby offers $1.7bn
Tel: +44 (0)1737 855164
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for NBPOL
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26 Toughening discharge 8 Biotech News
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13 Diary of Events
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14 International Market Review
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1 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Contents.indd 1 22/10/2014 11:11

 NEWS
COMMENT
No foreign cap
F
oreign oil palm plantation players will
have breathed a sigh of relief after
Indonesia dropped a controversial
30% foreign ownership cap in its
plantations bill passed on 30 September.
The original bill would have retroactively
limited foreign ownership of plantations to
no more than 30%, down from the current
maximum of 95%, potentially hurting
Malaysian players such as Sime Darby Bhd,
Kuala Lumpur Kepong Bhd and IOI Corp
Bhd, and Singapore-listed Golden Agri-
Resources and Wilmar International.
The new law (see story, below) will still allow the central government
to limit direct foreign investment in Indonesia’s plantation sector
through government regulations, based on the type of crop, the size of
the producing company and certain geographical conditions.
However, analysts believe this is unlikely to happen as incoming
President Joko Widodo, who is due to assume office on 20 October,
is known to be pro-business, pro-agriculture and against foreign
ownership limits in plantations.
Although the bill’s aim was to maximise land usage and open up
the sector to smallholders, and could be attributable to electioneering
before the July presidential elections, the underlying factor driving
moves to limit foreign ownership is deeply rooted in ‘commodity
nationalism’.
Indonesia is home to the world’s largest gold mine and exports the
most power-station coal, palm oil and tin, according to Bloomberg.
Outgoing President Susilo Bambang Yudhoyono has introduced a
series of nationalistic rules for commodities – including palm, cocoa
and mining – in an effort to boost domestic processing industries and
the value of its exports.
In 2012, foreign mining companies were made to divest at least
51% of their shares to Indonesian buyers after 10 years of operation.
In January, Indonesia banned the export of metal ores to encourage
the construction of smelters, which led to mine closures, thousands of
lost jobs and a global surge in nickel prices.
Parliamentarians have also drafted two bills that aim to limit foreign
ownership in banking and insurance.
One cannot blame a country like Indonesia for trying to push
investment in value-added manufacturing and services and create a
more even distribution of wealth. However, critics including the World
Bank say such policies often backfire, driving away investors, which
could cost Indonesia more than US$6.5bn in lost taxes and royalties
over the next three years, crippling efforts to build roads, schools,
hospitals and other infrastructure.
Resource nationalism is making commodity prices more volatile and
threatens global security, think-tank Chatham House said in a report
in 2012. “When countries and governments think they may be running
out of cheap resources, they try to keep more for themselves.”
China, Ukraine and Argentina responded to the surge in food prices
in 2008, for example, with taxes or controls on grain exports.
Such moves can trigger similar actions in other countries,
threatening trade wars, driving up prices and creating a crisis of
confidence that spreads from one resource to another.
The think-tank argues that new institutions are needed to
collaborate in managing resources and reducing volatility, such as a
“Resources 30” group of economies, which could set rules on export
restrictions and the activities of state-owned resource companies.
Until then, growing “resource nationalism” will continue to raise
serious concerns about the predictability of the business environment
and long-term economic growth. Serena Lim
2 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Comment and News.indd 1
Sime Darby offers
$1.7bn for NBPOL
S
ime Darby Plantation Sdn Bhd offered to buy Papua New Guinea-
based New Britain Palm Oil (NBPOL) for some US$1.74bn or
£7.15/share on 9 October.
The move comes after the plantation and agri-business arm of
Malaysia’s Sime Darby group aborted plans to buy Kulim (Malaysia)
Bhd’s 49% stake in NBPOL after its 60-day exclusivity period with Kulim
expired on 28 September. Kulim’s stake was up for sale after it failed to
raise its shareholding from 48.97% to 68.97% in July 2013.
Sime Darby president and chief executive Tan Sri Mohd Bakke Salleh
said the acquisition would be a significant milestone for one of the
world’s largest producers of sustainable palm and palm kernel oil, as it
was acquiring a low-risk, well-managed ongoing business that would add
value to the group.
The two companies’ combined land bank would be nearly one million
hectares, up from Sime Darby’s current holdings of 864,141ha spread
across Malaysia, Indonesia and Liberia. NBPOL’s two refineries in Papua
New Guinea and the UK would boost Sime Darby’s total refining capacity
by 300,000 tonnes to 4.05M tonnes.
Sime Darby’s bid amounts to an 85% premium over NBPOL’s last
closing share price of £3.87/share on 8 October.
“We don’t mind paying a premium price considering its [NBPOL’s]
potential high fresh fruit bunch yields and high oil extraction rate,”
Salleh said.
“The premium paid for NPBOL’s assets reflects competition for
developed oil palm projects, as the hurdle rate for developing a new
oil palm plantation is increasing due to issues like land acquisition,”
Barclays said in a Reuters report.
Nearly two-thirds or 79,800ha of NBPOL’s existing landbank of
135,000ha, mostly located in Papua New Guinea, is already planted
with oil palm.
Sime Darby Plantation is one of the world’s largest plantation
companies, producing some five percent of global crude palm oil output.
NBPOL said in a statement that an independent board committee
intended to recommend Sime Darby’s bid to shareholders in the
absence of a higher offer. The acquisition is expected to be completed
by the end of the year, subject to Sime Darby obtaining a minimum of
51% of NBPOL shares, and regulatory conditions.
Foreign ownership cap dropped
Indonesia’s House of Representatives passed a new plantation bill on
30 September, which sets stricter rules on foreign ownership in the
plantation sector so as to maximise land usage and open up the sector
to smallholders.
A controversial 30% foreign ownership cap was dropped.
Instead, any specific limit will be decided separately through
government regulation (Peraturan Pemerintah or PP), which will not need
further parliamentary approval.
Plantation business groups, as well as the Agriculture Ministry, had
previously voiced criticism of the bill, expressing concern that it would
hurt the business climate for plantation firms and growers.
The new law requires plantation companies to allocate 20% of their
concessions to people who live in nearby areas and to help them with
their own plantations, which is already a long-standing practice by foreign
companies.
The new law also regulates the scope of plantation areas and land
concessions according to a number of variables, such as the type of crop
grown, the company’s factory capacity, the area’s population density and
certain geographical conditions.
The central government will also have the right to turn over state-
owned forests and abandoned plots of land to plantation owners. But
the law also requires plantation owners to conduct discussions with
indigenous residents over plots of lands to be acquired.
Companies will have five years to comply with the new law.
20/10/2014 16:47
 NEWS

China extends GM inspection vigilence to US sorghum

C hinese authorities are stepping up checks
on US cargoes of sorghum, traders
told Reuters in August, potentially curbing
shipments from the world’s largest exporter of
the corn-substitute.
Four traders with direct knowledge of the
matter said the country’s quarantine office in
July asked local authorities to tighten checks of
sorghum and barley, looking for impurities such
as pesticide residues and heavy metals.
The move comes after China has already
rejected more than one million tonnes of
US corn due to the presence of Syngenta’s
genetically modified (GM) corn strain MIR 162
that has not yet been approved by Beijing.
Chinese feed mills have increasingly been
turning to US sorghum as a cheap substitute
for domestic corn, which has seen inflated
prices as Beijing supports the country’s rural
population.
“There are worries in the market, which
should reduce imports of sorghum in later
months,” said Zhang Yan, an analyst at
Shanghai JC Intelligence Co Ltd.
JCI cut its forecast for sorghum imports
to 1.6M tonnes for the 2014/15 marketing
year, down from 3.9M tonnes predicted
earlier.
China is the world’s largest importer of US
sorghum, with its feed mills buying almost all
their sorghum from the country.
“Shipments already booked or on the way
to China may have no problem, but bookings
after the notice may face trouble,” said another
industry source, adding that some of the major
buyers had already been informed of strict
checks.
Sorghum is traditionally used to make
alcohol in China but use in animal feed surged
last year as the industry sought to diversify
ingredient supplies and replace expensive
domestic corn.

Palm kernel and coconut oil shipments forecast to climb IN BRIEF

slide left coconut oil prices at a US$225/tonne INDIA: Emami Biotech Ltd, the
premium to PKO as of 3 September, Oil World said. edible oil and biodiesel arm of
“Supply disruptions, primarily in coconut oil, and Emami Group, has entered into
high price volatility have interrupted the strong an agreement with Kolkata-
growth of global demand for lauric oils in recent based Rasoi Group to buy
years,” Oil World wrote. “We expect world exports the Rasoi brand of vanaspati
of coconut oil to recover from the multi-year low. (hydrogenated fat) and edible oil
“The price premium of coconut oil over palm for Rs13 crore (US$2.1M), the
oil and PKO is likely to stay above average in the company said in September.
foreseeable future, but will probably soon ease The acquisition will be an
from the current unusually high levels,” Oil World addition to Emami’s existing
added. portfolio of edible oil brands,
Typhoon Haiyan, which hit the Philippines such as Emami Healthy &
in November 2013, caused damage to residential, Tasty and Himani Best Choice.
commercial and agricultural properties valued Emami Biotech also plans

S hipments of palm kernel oil (PKO) and

coconut oil are expected to climb in 2014-
15, Bloomberg reported Oil World as saying in
September. The increase comes as the industry
rebounds from a year-earlier slide stemming,
in part, from damaged coconut trees in the
Philippines following Typhoon Haiyan.
Exports of both oils may climb to 5.4M tonnes
from 5.1M tonnes in 2013-14. Philippines coconut
oil production is predicted to climb to 1.34M
tonnes, after slumping to 1.22M tonnes in
2013-14 from 1.62M tonnes a year earlier. The
at US$6.5bn to US$14.5bn, according to
estimates by catastrophe modelling firm AIR
Worldwide.
to build its third refinery with
a capacity of 2,000 tonnes/
day in Gujarat to cater to India’s
The typhoon damaged 33M coconut trees in the northern and western markets,
Philippines’ Eastern Visayas region alone, and new which is expected to become
trees take six to eight years after planting to reach operational in around 18-24
full production potential, according to the United months.
Nations Food & Agriculture Organization.
Production of PKO will rise to 6.73M tonnes in WORLD: Procter & Gamble
the year through September 2015 from 6.47M (P&G) has declared a
tonnes, with output in Indonesia climbing to 3.42M commitment to no deforestation
tonnes from 3.22M tonnes, Oil World forecast. in its palm oil supply chain.
These commitments include
establishing traceability of

‘Gutter oil’ contamination prompts product recalls palm oil (PO) and palm kernel
oil (PKO) to supplier mills by

O n 14 September, Hong Kong ordered a massive
recall and ban on 25 lard and lard-containing
products imported from Taiwanese food oil
manufacturer Chang Guann Co, which admitted its
products had been contaminated with ‘gutter oil’.
Hong Kong also banned all food made with the
products.
‘Gutter’ oil is illegal cooking oil that has been
recycled from waste oil or discarded animal parts.
Chang Guann admitted on 5 September that lard it
had purchased from an unlicensed factory in Taiwan
had been used as a base oil in the manufacturing of
edible lard oil.
“We only began purchasing lard from the Pingtung
factory on 25 February this year. As of last month, a
total of 243 tonnes of lard had been bought from the
factory, 216 tonnes of which have been used as a
base oil in the manufacturing of 780 tonnes of edible
lard oil,” the company said in a press release.
“We are also a victim in this case. Although not all
of our fragrant lard oil products contain the alleged
gutter oil, we ordered the recall of all products with the end of 2015, ensuring no
an expiration date before 1 March next year.” deforestation in the palm supply
According to Taiwan’s Food and Drug chain to plantations by 2020
Administration (FDA), hundreds of mooncakes, and working with suppliers
along with pineapple cakes, bread, instant noodles, (including smallholders),
steamed buns and dumplings had been removed industry peers, NGOs, academic
from shelves in the country since the case surfaced. experts and other stakeholders
More than 1,000 restaurants, bakeries and food to promote consistent industry
plants had also used the tainted oil. standards and practices for
FDA Southern Center deputy director Liu Fang-ming sustainable PO sourcing. P&G’s
said if Chang Guann bought the suspect lard without PO already receives Roundtable
knowing what it really was, the company’s owners on Sustainable Palm Oil (RSPO)
might only be subject to a fine. certification.
“However, if the firm was aware of the lard’s real Colgate-Palmolive has also
contents and still used it to manufacture cooking recently released its own PO
oil, its owners could face a maximum prison term of sourcing policy, commiting to
seven years,” he said. sustainably sourced PO with
Some experts believe that about a tenth of China’s zero deforestation and full
cooking oil is gutter oil, with the first documented traceability of PO back to the
case reported in mainland China in 2000 and, in plantation by 2015.
Taiwan, in 1985.

3 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Comment and News.indd 2 20/10/2014 16:47

 NEWS

IN BRIEF
SWITZERLAND: Bühler has
Chinese imports of soyabeans
launched a new horizontal
sunflower impact dehuller, the
‘DGBB’, which the company
said facilitates optimal
to plunge ahead of US harvest
extraction results when
processing sunflowerseeds,
C hinese imports of US soyabeans could plunge
by as much as a quarter in the crop year that
began in September, after processing margins in
senior official at an international trading company,
which owns soyabean processing facilities in China.
“With the way things are, we don’t expect prices
with efficient dehulling and
the country fell to their lowest in two years, industry and demand to recover any time soon,” he added.
minimised broken seeds. The
sources told Reuters. Record soyabean imports in the 2013/14 crop
product flow has achieved
The potential drop in shipments to the world’s year, coupled with slowing demand from the livestock
high throughput rates of up to
biggest buyer of soyabeans comes as the USA is sector, have resulted in a glut of soyabeans in China,
180 tonnes/day and this can
gearing up to harvest a record soyabean crop, piling dragging processing margins into negative territory.
now be controlled through an
more pressure on benchmark prices that have hit China’s crackdown on commodity financing trade
inspection window in the feeder,
their lowest in four years. has compounded the woes of an industry saddled
which helps ensure the product
Any hopes that demand for the products produced with huge losses, prompting some imports to default
is evenly spread over the
by China’s soyabean processors would pick up in the on cargoes.
entire machine width. Different
next few months have been dashed by slow growth. Those challenges did not filter through to January
moisture content values or
This has left processors struggling with the so- to July total soyabean import volumes, which climbed
sunflowerseed varieties can
called negative margins they have suffered since about a fifth from the year before to 41.68M tonnes,
be processed and the DGBB
February, meaning they cannot cover the costs as a raft of cargoes booked in advance arrived in
provides a consistent dehulling
of producing edible oil or animal-feed ingredient China.
degree with reduced fines and
soyameal. But they are expected to hit soyabean shipments
dust, leading to a reduced
“The first half of the (calendar) year was the worst from October to December, historically the period
risk of oil impregnation. All
on record for the industry”, said a Singapore-based when imports pick up, the Reuters report said.
components are easy to clean,
are accessible and easy to
exchange in a very short time,
the company said, which leads
California approves stricter olive oil labels and grades
to operational advantage and
reduces maintenance costs. T he state of California, USA has
approved stricter standards
on the labelling and grading of
than 0.5g/100g, a median of
defects equal to 0, and the other
characteristics which correspond
ISRAEL: Lipid supplements olive oil, Olive Oil Times reports. to the limits fixed for this grade in
manufacturer Enzymotec Ltd The rules came into effect on these standards. Extra virgin olive
has added a new phospholipid- 26 September for California oil is fit for consumption without
based item to its range. producers that produce at least further processing.”
‘Omega PC’ is an extract 5,000 gallons/year, which applies Californian producers, who
from wild, cold water fish and to an estimated 100 growers and that, when olive oil is used supply approximately two percent
comprises omega-3 fatty acids around a dozen mills. as an ingredient in prepared of American olive oil needs,
bound to both phospholipids The new standards include food, the label must specify have been vocal proponents of
and triacylglycerols. Dr Ariel more precise methods for testing the grade used. However, that the new regulations, seeking to
Katz, president and CEO of adulteration, known as PPP type of regulation was found differentiate their products from
Enzymotec, said: “We believe and DAGs, and the banning of to be beyond the scope of the imported olive oils, which they
that this new advanced misleading marketing terms for standards as well as beyond say are often substandard.
fish oil product should help refined oils such as ‘light’ and the authority of the California Additionally, while the new
drive growth in the omega-3 ‘pure’. The benchmark for free Marketing Act. rules only affect olive oil
fish oil market, which [has fatty acidity (FFA) has been set Extra virgin olive oil is produced in California, industry
become] stagnant due to at 0.5%, below the international defined as “olive oil that has observers say the ultimate aim is
commoditisation and lack of standard of 0.8%. a free acidity, expressed as to have stricter standards apply
innovation.” The proposal suggested free oleic acid, of not more to imports as well.

India’s vegetable oil imports hit record highs and forecast to rise even further
India’s vegetable oil imports
touched 13.33 lakh (1.3M)
tonnes in August this year – the
highest for the last two decades –
on record shipments of soyabean
oil, industry body the Solvent
Extractors’ Association (SEA) said
in September.
Imports are expected to rise
further in coming months and
put pressure on domestic edible
oil prices, the SEA warned,
adding that vegetable oil imports
were getting cheaper following
measures taken by Indonesia and
Malaysia to clear their huge stock.
To curb cheap imports and
protect local oilseeds farmers, the
SEA demanded the government to
hike the import duty on crude and
refined edible oils from existing
levels.
The country’s previous highest
import was 11.6 lakh (1.16M)
tonnes in January 2013.
“Import of vegetable oils during
August is up by 76% at 13.33 lakh
(1.3M) tonnes, compared to 7.57
lakh (757,000) tonnes in August
2013. This is the highest in any
single month since import allowed
under open general licence (OGL)
in 1994 by India,” the SEA said.
Of total vegetable oil imports,
palm oil shipments stood at
805,131 tonnes, soyabean oil at
350,373 tonnes, sunflower oil at
140,349 tonnes, while non-edible
oil comprised 12,135 tonnes
during August this year.
India’s vegetable oil imports are
likely to increase and put pressure
on domestic edible oil prices,
which currently are at an historic
low since 2008, it said.
Palm oil imports by India,
the world’s biggest buyer, could
increase due to expected lower
global prices after Malaysia cut its
export tax on CPO for two months,
effective from September.
In reply, Indonesia set its export
tax on CPO to zero in October,
down from the nine percent rate in
September.
Indonesia sets its monthly
export tax according to a formula
based on average prices in
Jakarta, Rotterdam and Kuala
Lumpur.
Emphasising the need to
protect domestic farmers, the SEA
said: “There is an urgent need
to support farmers by increasing
import duty on crude vegetable
oils from 2.5% to 10% and refined
oils from 10% to 25%, which is the
only viable option.”

4 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Comment and News.indd 3 20/10/2014 16:47

Crown Raw Materials Ad-A4_MAR14_Layout 1 3/13/14 2:03 PM Page 1

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 BIOFUELS NEWS

IN BRIEF
INDONESIA: Starting in 2016,
the country’s PT Garuda
airline will blend avtur, a type
of aviation fuel, with palm oil-
based biofuel to help reduce
its carbon emissions, Biofuels
International reports. The airline
will use approximately 1.8bn
litres/year of avtur to operate its
aircraft. As a result, from 2016,
Garuda’s jet fuel consumption
is expected to reach two billion
litres/year.
UK: British Airways is planning
to fuel its planes with biofuel
derived from municipal waste
such as paper, food and garden
clippings, Biofuels International
reports. The first of these
projects is GreenSky London,
currently under construction,
which will be able to process
some 50,0000 tonnes/year
of waste and convert it to
approximately 60,000 tonnes/
year of jet fuel.
US industry board urges end
to ‘unfair’ EU trade duties
T he US National Biodiesel Board (NBB) has filed
comments with the European Commission (EC)
challenging what it says are unfair trade duties that
have blocked US biodiesel from being exported to
Europe since July 2009.
The NBB urged the EC to allow duties on US
biodiesel to expire this year as scheduled, citing
overwhelming evidence that global trade for
biodiesel had changed dramatically since the duties
were imposed and that continuing the duties was
protectionist and unnecessary.
European biodiesel producers were able to sell
biodiesel in both Europe and the USA without duties
and, at the very least, US producers should be able
to take part in the European market without having to
pay punitive duties, the NBB said, pointing out that:
! US imports of biodiesel from the EU had grown in
Neste shelves microbial oil process
N este Oil announced on
PHOTO: NESTE OIL
recent years while EU imports of US biodiesel had
been virtually eliminated.
! The US biodiesel tax incentive, the main reason
behind the EU’s trade duties, was currently not
in effect and hadn’t been for three of the past five
years.
! Because it is structured as a blender’s incentive,
the US biodiesel tax incentive is available to
European producers when it is in effect, as well
to US producers. European imports to the USA
can also qualify for the Renewable Fuel Standard
(RFS), the policy that requires specific volumes of
renewable fuels to be blended in the USA.
The original duties imposed by the EC in 2009 are
due to expire this year but the EC is conducting an
“expiry review” expected to last 12-15 months over
whether to reinstate them.
Summit Group
to build ethanol

7 October that it was moving

USA: A California-based biofuel
company building a waste to
jet fuel plant east of Reno has
been awarded a US$70M grant
from the US Department of
Defense to help speed delivery
of its high-tech process that
converts household waste into
jet fuel. The plant is expected
to produce more than 10M
gallons/year of advanced
biofuels while diverting over
200,000 tonnes of waste from
landfills by 2016.
ZAMBIA: Mahtani Group
has partnered with UK-based
Sunbird Group to develop a
US$150M bioethanol plant
in Luapula province, Biofuels
International reports. The
plant will use cassava as its
feedstock, which is widely grown
in the province. Production
was expected to start up in
November this year.
PORTUGAL/GREECE: Portugal-
based biodiesel technology
provider IncBio announced in
September it had signed a
contract with SPA Renewables
SA to supply a 2.4M gallons/
year biodiesel plant in Corinth,
Greece. The plant will use
IncBio’s ultrasonic reactors to
produce EN14214 biodiesel
from used cooking oil collected
locally. IncBio said it expected
the plant to be complete by the
end of February 2015.
away from its R&D efforts on
microbial oil to other areas such
plant in Brazil
as using forestry and agricultural
waste and residues as feedstocks Iowa, USA-based Summit
Group, a leader in production
agriculture, renewable energy
for renewable diesel.
Two years of research at its and international agribusiness
pilot plant in Porvoo (pictured left) development, will construct a
had generated a lot of knowledge corn ethanol production facility in
but Neste’s senior vice president Brazil, Ethanol Producer Magazine
of technology Lars Peter Lindfors reported in September. The
said the process was not yet US$140M plant will be built near
economically competitive. leading agricultural state Lucas
“Lignocellulose material is not do Rio Verde in Mato Grosso, the
a financially competitive indutrial country’s largest producer of corn
feedstock for producing renewable and soyabeans.
diesel using the microbial oil When operational, the plant
process at the moment.” will produce 50M gallons/year of
ethanol.
Biofuel production down, biodiesel up, forecasts IEA
A n International Energy Agency (IEA) report said
that global biofuels production increased by
almost seven percent last year, reaching more than
increased biofuel production was waning in the
key markets of Brazil, the EU and the USA. It was,
however, expanding in new non-OECD markets, such
115bn litres (30.38bn gallons). This is three billion as Southeast Asia.
litres higher than predicted in the IEA’s report of the “In the USA, the design shortcomings of previous
same time in 2013. biofuel mandates have become manifest, leading to
When adjusted for energy content, biofuel output policy review that have introduced uncertainty in the
accounted for 3.5% of global oil demand for road market”, the authors stated.
transport in 2013, up from 3.4% in 2012 and 2% in “In Brazil, the ethanol industry’s economic
2007. Production is expected to reach 139bn litres situation is worsening, partly due to inflation-
in 2020. targeted gasoline price regulations that undermine
According to the report, the forecast has been ethanol economics. In the EU, ongoing controversy
revised down since last year’s outlook, with 2018 about the sustainability of biofuels has led to a
production forecast to be two billion litres in 2020. proposed cap on conventional biofuel use that is
The biodiesel forecast has been increased slightly, leaving the industry in limbo until a final decision
with 2020 production expected at 33bn litres. on the proposal is taken. At the same time, policy
Advanced biofuel capacity is expected to reach support is burgeoning in non-OECD countries, notably
four billion litres by 2020, with developments oil-importing economies in Southeast Asia and
expected to be limited primarily to the European Africa that subsidise fuel consumption, where rising
Union (EU) and USA. domestic biofuel production promises a valuable
However, the report said that policy support for option to lowering fuel import bills.”

6 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Biofuel News.indd 1 23/10/2014 12:55

 BIOFUELS NEWS

EC carries out anti-trust raids on ethanol companies

O fficials from the European Commission
(EC)’s competition watchdog raided the
headquarters of several ethanol companies on
7 October based on allegations the companies
were manipulating industry benchmarks, the
EC confirmed.
The EC said it had it on good authority that
ethanol companies from two different member
states may be colluding to provide faulty price
information to a price-reporting agency, which
then offered up the faulty information as a
benchmark for the marketplace to trade on.
“Such behaviour, if established, may amount
to violations of European anti-trust rules
that prohibit cartels and restrictive business
practices and abuses of a dominant market
position,” the EC said in a statement.
The prices published by price reporting
agencies served as a benchmark for trade in
the physical and financial derivatives markets
for several commodity products in Europe and
globally, the EC said.
And even small distortions could have
a significant impact on prices, potentially
harming consumers.
The companies raided include Lantmannen
Agroetanol in Sweden and Agroetanol in
Belgium. The EC cautioned that it was only in
the preliminary stages of its investigation and
that the inspections did not amount to a guilty
charge for the companies.
The raids follow similar allegations against
BP PLC, Statoil ASA, Royal Dutch Shell PLC,
and others related to price manipulation in the
biofuels industry, according to Law360.
The EU and the Norwegian Competition
Authority are investigating whether these
companies passed off coordinated numbers to
a price-regulating agency.

Commercial production at 2G ethanol plant in Brazil Demand set to

I n Brazil, GranBio has initiated
production at the first
commercial-scale plant for
second-generation (2G) ethanol in
the southern hemisphere, Biofuels
Digest reports.
The Bioflex 1 unit in São
Miguel dos Campos, Alagoas,
has an initial production capacity
of 82M litres/year of ethanol
and uses Proesa pre-treatment
technology from Italian company
BetaRenewables, enzymes from
Novozymes in Denmark and yeast
from DSM in Holland.
GranBio invested US$190M
to build the plant and US$75M
on the steam and electricity co-
generation system.
Construction was completed
in 20 months and was managed
by GranEnergia, a company also
controlled by GranInvestimentos
SA.
The report said the 2G ethanol
made it possible to increase
Brazilian production capacity by
50%/acre using agricultural waste
such as straw and bagasse,
without expanding the area of
sugarcane fields.
Gran Bio developed a system
to harvest, store and process
400,000 tonnes/year of straw
for Bioflex 1, which makes it one
of the world’s largest and most
competitive.
According to a 14 October
Bloomberg report, GranBio is also
close to announcing a partner for
a second cellulosic ethanol facility,
which will be comparable in size
to the Bioflex unit.
The company also plans a
second biochemical plant.
double in China
C hina’s biodiesel demand
will double by 2017 from
2013 levels to as much as
2.5M tonnes/year or more,
according to a new report from
ResearchinChina.
The report said that in 2013,
China’s total capacity of biodiesel
exceeded 3.7M tonnes/year, but
output attained 1-1.2M tonnes/
year, indicating that capacity
utilisation was not high.

7 OFI – OCTOBER/NOVEMBER 2014

Biofuel News.indd 2 23/10/2014 12:55

 BIOTECH NEWS

IN BRIEF
USA: On 18 September, the
Department of Agriculture
(USDA) reached a decision to
deregulate Dow’s 2,4-D resistant
I
Enlist Duo soyabeans. The
American Soybean Association
(ASA) approved the move and
called on the Environmental
Protection Agency (EPA) to
quickly finalise the label for a
new low-volatility Enlist Duo
herbicide that could be used
with these soyabeans to control
resistant and difficult-to-manage
weeds.
WORLD: A team of international
researchers has sequenced
the genome of the Nevada
dampwood termite to
understand how the more than
4,000 species of bacteria that
thrive in their guts work together,
AGWeb reports. Specifically, the
researchers hope to identify
enzymes that could lead to
novel ways to produce cellulosic
biofuels.
Grain elevators may refuse
unapproved GM seeds, US rules
n August, in response to a lawsuit filed by Syngenta
against Bunge – which refused to accept Syngenta’s
Agrisure Viptera variety of corn – the US court of
federal appeals ruled that “A biotech developer
cannot use a century-old warehouse law to force
a grain elevator company to accept its genetically
engineered corn”.
The ruling will likely preclude other biotech seed
companies from using a similar litigation tactic with
elevators that reject crops due to their transgenic
traits, experts have said.
The controversy dates back to 2011, when the
Bunge elevator company refused to accept the
Agrisure Viptera corn variety produced by Syngenta
seeds. Bunge told growers it couldn’t accept the
variety because it hadn’t cleared regulatory hurdles in
all major export destinations.
The trait hadn’t been approved by officials in
China – and has since been rejected by the Chinese
China considers inspection change
authorities. Syngenta now faces three billion-dollar
class actions in three states.
In response, Syngenta filed a lawsuit accusing
Bunge of violating the US Warehouse Act of 1916,
which requires elevators to treat depositors fairly.
Farmers who grew Viptera corn had to ship their
crops to other elevators and find other sources of
corn to fulfil their contracts with Bunge, which hurt
Syngenta’s reputation and market share, the biotech
company claimed.
The 8th US Circuit Court of Appeals threw out
Syngenta’s lawsuit, ruling that the company lacked a
“cause of action” to bring against Bunge in court.
Farmers directly affected by Bunge’s refusal may
still sue the elevator company, but the Eighth Circuit’s
ruling would prevent similar lawsuits by Monsanto,
Dow, DuPont or another biotech seed firm, said Drew
Kershen, an agricultural biotechnology law professor
at the University of Oklahoma.
Europe causing
GM crop approval

GERMANY: Farming company

C hinese regulators are considering whether or not to change the
KTG Agrar AG plans to expand
soyabean cultivation in
expectation of major European
demand for crops free of
genetically modified (GM)
organisms. KTG said it planned
to harvest around 20,000
tonnes this year and more than
25,000 tonnes next year of GM-
free soyabeans. The company
will process the beans in its oil
mill.
Scientists successfully sequence rapeseed genome
inspection requirements for shipments of US corn by-products,
according to four people with direct knowledge of the subject, delays, group says
Bloomberg reported in September.
Imports of dried distillers grains (DDGs) currently require government
certification that proves they do not contain MIR 162, a GM corn
E uropaBio – Europe’s largest and
most influential biotech industry
group, whose members include
variety. In a meeting with industry officials in Beijing, regulators were
giants such as Monsanto, Bayer
reported to have discussed widening the inspection regime to third
and other biotech companies –
parties.
has accused the European
The four people said Chinese officials had discussed using a
Commission (EC) of failing
polymerase chain reaction method for inspections, which involves
to comply with existing legal
replicating a small sample of genetic material to test for the presence
timelines to formally adopt import
of specific genes. However, shipments would still be subject to further
authorisations of genetically
inspection in China. As OFI went to press, no final agreement had been
modified (GM) crops.
made and no meetings were scheduled.
The group said this had caused
delays of up to eight months and
added significantly to the already
existing delays between the EU and
exporting nations.
for Agricultural Research (INRA) said: “We have The group said it would
discovered the mechanism by which the levels of continue to insist and request
glucosinolates, which make the crop less nutritious that the procedures set out in EU
for livestock, can be reduced.” law for approving GM products
He added: “Our breakthrough will also help be followed, and that legally
scientists in their efforts to make oilseed rape more prescribed timelines were met.
resistant to disease, improve yield and its take- Not doing so would send a
up of nitrogen from the soil, thereby improving its message to the agriculture-
environmental profile.” related industries of Europe
Oilseed rape has one of the most complex and beyond, as well as to other
genomes among flowering plants. “The gene number innovative sectors, that Europe

S cientists have successfully sequenced the

complex rapeseed genome, which will accelerate
ongoing research efforts to improve the crop for
animal and human nutrition. A Reuters report said
Germany’s Bayer – the world’s largest supplier of
genetically modified (GM) rapeseed seeds – was
primarily responsible for the mapping out of the entire
genetic code of the oil plant.
Academic researchers in Australia and China,
as well as Dutch biotechnology firm Keygene NV,
contributed to the project, Bayer said. Coordinator
Boulos Chalhoub of the French National Institute
is four times that of the human genome,” said
Chalhoub. He said that after five years of research,
the consortium had detected 1,600 genes that are
implicated in oil-based synthesis, findings which will
support researchers aiming to develop rapeseed
variants rich in omega-3 fatty acids for human and
animal feed needs.
Rapeseed is used for food oil and is a common
feedstock for biofuel in Europe. Bayer made €250M
(US$370M) in sales from GM rapeseed and from
pesticides for rapeseed farmers last year, around
15% of the global market.
could not guarantee a predictable
regulatory system and sound trade
environment, it said.
The nine GM applications
in question were four biotech
soyabean varieties, one oilseed
rape and one cotton. They have
all received positive safety
assessments from the European
Food Safety Authority and gone
through two rounds of voting by the
EU under ‘cosmitology’ rules.

8 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Biotech News.indd 1 22/10/2014 10:06

Project1_Layout 1 4/3/14 2:13 PM Page 1

IN BRIEF
ARGENTINA: On 15 August,
Noble Group Ltd announced
that the company’s wholly-
owned subsidiary, Noble
Argentina SA, had agreed to
acquire a 22.75% shareholding
interest in Sitio 0 de
Quequén (Sitio 0), a company
incorporated in Argentina.
Upon completion, Sitio 0 will
become an indirect associated
company of Noble. The
consideration for the acquisition
was approximately US$17M,
excluding an additional payment
of up to US$3M.
USA: In mid-August, Pacific
Northwest Grain Companies
and the International Longshore
and Warehouse Union reported
that they had reached a
tentative labour agreement in
a two-year standoff affecting
grain export facilities at
ports in Portland, Seattle and
Vancouver, reports Oregon
Public Broadcasting News (see
OFI, Transport News, August/
September 2014). No specifics
were provided on the terms
of the deal, which would pave
the way for United Grain Corp
to start moving grain from the
Port of Vancouver. Since July,
the company has only been
able to make a few shipments
from the port because of the
dispute over work rules and
pay. Other companies included
in the agreement are Columbia
Grain at the Port of Portland
and Louis-Dreyfus Commodities,
which operates grain terminals
in Portland and Seattle.
US grain glut taxes storage facilities, transport sector
A stockpile of US Midwest grain will likely increase
in the coming months and tax farmers already
desperate to house or haul corn, soyabeans and
other products ahead of an expected record harvest,
a US Department of Agriculture (USDA) official said in
September, Reuters reports.
Grain stocks this harvest season are expected
10 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Transport News.indd 1
TRANSPORT & LOGISTICS NEWS
ADM gains second US export
terminal in Pacific Northwest
A rchers Daniels Midland (ADM) has acquired an
ownership stake in a second export terminal
in the US Pacific Northwest, a vital gateway for US
handled by export facilities in the Pacific Northwest,
offering shippers the shortest route to Asia and top
soyabean importer China, and top grain importer
agricultural shipments to Asia, according to a Reuters Japan. Kalama Export Company currently runs a bulk
report. grain terminal in Kalama, Washington, about 64km
ADM announced the move on 30 September upriver from the Columbia Grain terminal.
and said it had gained the ownership stake in the ADM and Marubeni each owned 45% of the
Columbia Grain export terminal in Portland, Oregon, Kalama terminal, with Mitsubishi holding the
by expanding its Kalama Export Company joint remaining 10%.
venture with Japanese grain trader Marubeni Corp, An ADM spokeswoman said that under the new
previously the terminal’s sole owner. expanded joint venture, ADM would own 32.2% of the
“There’s a lot of competition in the Pacific two elevators, Marubeni 60.6% and Mitsubishi 7.2%.
Northwest and having the option to export from two The joint venture would be renamed Pacificor
elevators rather than just one can make the logistics LLC but the 50/50 ADM and Marubeni governance
of exporting grain much easier,” Terry Reilly, a grains structure would remain unchanged.
analyst from Futures International, said in the ADM did not disclose the value of the transaction
Reuters report. but said the company expected to record a gain in
“And, if you increase competition, it increases flow the quarter ending 30 September. That preliminary
and brings in more competitive prices.” value could be adjusted in the company’s fourth
Some 30% of US grain and oilseed exports are quarter results, the Reuters report said.
ADM’s SA export terminal operational FRA proposes
In August, the first loaded vessel departed Archer Daniels Midland
(ADM)’s new export terminal in Bacarena, in the northern Brazilian
rule to amend
state of Pará. The terminal is a significant addition to ADM’s
expanding logistical network in Brazil and offers an efficient pathway
US brake safety
for the export of grain from the increasingly productive western and
northern regions of the country. ADM received approval to begin
operations at the terminal at the end of July.
T he US Federal Railroad
Administration (FRA) has
opened a comment period on a
ADM acquired the terminal in 2012. It currently has the capacity to proposed rule that aims to amend
handle approximately 1.5M tonnes/year of grain, but ADM intends to brake system safety standards for
expand the terminal’s capacity to six million tonnes by 2016. certain freight and other non-
“The Bacarena terminal builds on our existing network, which passenger trains, Ethanol Producer
uses inland waterways, rail and truck transportation to move crops Magazine reported on
and products throughout Brazil,” Valmor Schaffer, president of ADM 19 September.
South America, said. “We are excited by the opportunities presented According to the new rule, trains
by Brazil’s expanding agricultural production and look forward to carrying ethanol would be among
continuing to be a part of the country’s success.” those impacted. A statement
published by the FRA notes the
proposal will help prevent the
unintended movement of trains.
“Safety is our top priority”,
to exceed permanent storage facilities by around said US transportation secretary
694M bushels, or about 3.5% of expected harvest Anthony Foxx. “[This] action is
totals, said Arthur Neal, who analyses market and only the latest in more than two
transportation issues in the agricultural sector. dozen steps we have taken in
That overstock could fill roughly 174,000 jumbo the last year to further safeguard
hopper rail cars with South Dakota, India, Missouri communities along train routes
and Illinois most impacted. that carry crude oil and other
“Because 2013 grain is reportedly still in storage flammable liquids.”
and waiting to be moved before the 2014 harvest, According to the notice, the FRA
it is critical to move as much of the 2013 grain crop is proposing to amend the existing
as quickly and efficiently as possible,” Neal told a regulations to include additional
hearing of the Senate Commerce Committee. securement requirements for
The glut is causing snarls along train lines and unattended equipment, primarily
driving other transportation costs higher. for trains transporting certain
Barge rates along the Mississippi and Illinois
rivers, for instance, are roughly 50% higher than the
five-year average.
substances. This includes
poisonous by inhalable hazardous
materials, some flammable gases,
Neal was testifying at a hearing about congested flammable or combustible liquids
rail lines, which have been burdened in recent – including crude oil and ethanol
months by a bump in agriculture production, coal – and some explosive hazardous
deliveries and oil train shipments. materials.
22/10/2014 10:18

IN BRIEF
USA: Virdia Inc announced on
2 September that it would build
a US$60M biochemical facility
to turn sugarcane bagasse into
B
industrial sugars and biofuels at
the Raceland Raw Sugar Corp
mill in Raceland, Louisiana.
The plant is expected to be
completed by the end of 2016.
California-based Virdia is a
recent acquisition of Stora Enso
Oyj, a US$16bn/year global
forestry products company
headquartered in Finland.
BRAZIL: In June, speciality
chemicals producer Lubrizol
Corp, USA, announced it had
broken ground on a major
US$20M surfactant plant
expansion in Belford Roxo, Rio
de Janeiro. The company said
the expansion would allow it
to produce a larger portfolio
of surfactant products at the
facility, including “a significant
number of naturally-derived
ingredients” to meet the growing
demand for household cleaning
and personal care products in
the Brazilian market.
WORLD: In June, speciality
chemicals company Elevance
Renewable Sciences, USA,
added a second solvent and
degreasing product to its
portfolio, following its joint
introduction of Steposol
MET-10U surfactant with the
Stepan Company earlier this
year. Elevance Clean 1200 is
described as “a proprietary
ester blend derived from a bio-
based renewable feedstock”
aimed at removing industrial
residues such as automotive
lubricants, metalworking fluids
and hardened cooking greases.
The product will be produced at
Elevance’s biorefinery in Gresik,
Indonesia, a 180,000 tonnes/
D utch biotech company
year joint venture with Wilmar
International Limited, but new
capacity is being constructed at
Natchez, USA, which is expected
to come on-stream in 2015.
EUROPE: Global renewables
company Myriant Corp, USA
announced on 2 September that
speciality chemicals distributor
Azelis Group will distribute its
bio-succinic acid throughout
Europe. Myriant currently
produces bio-succinic acid from
renewable feedstocks at its
13,600 tonnes/year plant in
Louisiana, USA.
12 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
RENEWABLE NEWS.indd 1
R E N E WA B L E M AT E R I A L S N E W S
Superabsorbent polymers closer
for BASF, Cargill and Novozymes
ASF, Cargill and Novozymes announced on 15 petroleum oil. In July 2013, the partners successfully
September that they had progressed another demonstrated the production of 3-hydroxypropionic
step in producing acrylic acid from renewable acid (3-HP), one possible precursor to acrylic acid, at
raw materials with the successful conversion of pilot scale.
3-hydroxypropionic acid (3-HP) to glacial acrylic acid. “Now we are working full force on the set-up of a
They will scale up the process to produce bio- small integrated pilot plant until the end of this year,”
based acrylic acid, which BASF will initially use to said Teressa Szelest, senior vice president of BASF’s
manufacture superabsorbent polymers that can soak global hygiene business.
up large amounts of liquid, used primarily for diapers The pilot plant for 3-HP will be operated by Cargill
and other hygiene products. and supported by Novozymes.
“Cargill came together with BASF and Novozymes The companies said superabsorbent polymers
in August 2012 to do what had not been done ever and other products derived from bio-based acrylic
before,” said Jack Staloch, vice president of R&D acid would meet consumer and industry demand for
at Cargill. “It’s a great example of what can be consumer goods based on renewable raw materials
accomplished when industry leaders with unique and sustainable supply chains.
expertise in biotechnology and chemistry come BASF is the world’s largest producer of acrylic
together to create new innovations.” acid, a high-volume chemical that feeds into a
Currently, acrylic acid is produced by the oxidation broad range of products, including superabsorbent
of propylene derived mainly from the refining of crude polymers.
Braskem in renewable tyre project Genomatica says
A myris, Braskem and Michelin announced on 9 September that
Braskem was joining a partnership already launched in 2011
nylon is focus
between Michelin and Amyris to develop renewable isoprene for the
production of tyre and other rubber applications.
Braskem, Michelin and Amyris will work together to develop a
C alifornia-based Genomatica
announced in August that major
nylon intermediates – including
technology to utilise plant sugars, such as those found in sugarcane or hexamethylenediamine (HMD),
cellulosic feedstocks, to produce the renewable isoprene. caprolactam (CPL) and adipic acid
Brazil’s Braskem is the largest petrochemical company in the (ADA) – are the focus of its third
Americas and a global leader in the production of biopolymers, set of bio-based processes under
manufacturing green polyethylene from sugarcane-based ethanol. development.
Renewable products company Amyris will share its rights to Genomatica is developing
commercialise the isoprene technology developed under this complete process technologies for
collaboration with Braskem. Global tyre company Michelin will maintain the bio-based production of these
certain preferential, but not exclusive, access to the renewable intermediates, which it will then
isoprene to be produced by this technology. license to major firms in the nylon
Amyris uses its industrial bioscience technology platform to value chain.
convert plant sugars into a variety of hydrocarbon molecules, flexible “These three chemicals, with a
building blocks that can be used in a wide range of products including total market of over US$18bn/year,
cosmetics, polymers, lubricants, renewable diesel and jet fuel. are used primarily in the production
of nylon 6 and nylon 6,6, also
Funding for commercialising PEF referred to as the polyamides PA
6 and PA 6,6,” the company said
Avantium announced on
5 June that it had secured new
are now moving to commercial
deployment.”
Avantium uses its YXY
in a press release. Development
of commercial processes for
nylon intermediates is expected
investment of US$50M, which catalytic process to turn plant- to take several years and follow a
would be used towards the derived carbohydrates into furan sequence of technical, partnership,
commercialisation of its 100% dicarboxylic acid (FDCA) ad methyl scale-up and commercialisation
bio-based plastic, polyethylene levulinate, with the former then milestones.
furanoate (PEF). polymerised with ethylene glycol Genomatica is also inviting
The funding comes from a to give PEF. PEF can replace leaders in the nylon value chain to
consortium consisting of Swire fossil fuel-derived polyethylene join it as development partners.
Pacific, the Coca-Cola Company, terephlalate (PET) in applications Genomatica’s nylon
Danone, Alpla and existing ranging from drinks bottles to intermediates programme follows
shareholders. Proceeds will be industrial fibres. the commercialisation of its
used to complete the industrial According to Lipid Technology, process for producing butanediol
validation of PEF and finalise the Avantium has been working (BDO), which has been licensed by
engineering and design of its first with Danone and Coca Cola on BASF and by Novamont.
commercial-scale plant. developing PEF bottles since 2012 In December 2013, BASF
Avantium CEO Tom van Aken and, last year, Alpla signed an announced its first commercial
said: “Our proprietary YXY agreement to jointly develop PEF production of BDO using
technology to make PEF has been bottles for the personal and home Genomatica’s process (see OFI
proven at pilot plant scale and we care markets. March 2014, Renewable News).
22/10/2014 10:17

3-6 NOVEMBER 2014
World Ethanol and Biofuels
VENUE: Intercontinental Hotel, Budapest,
Hungary
CONTACT: Informa Agra Customer Services, UK
Tel: +44 (0)20 3377 3658
E-mail: registrations@agra-net.com
Website: www.worldethanolandbiofuel.com
5-7 NOVEMBER 2014
OFI Asia 2014
VENUE: Kuala Lumpur Convention Center,
Malaysia
CONTACT: Mark Winthrop-Wallace, International
Sales Manager, OFI, UK
Tel: +44 (0)1737 855114
E-mail: markww@quartzltd.com
Website: www.ofievents.com/asia
6 NOVEMBER 2014
FOSFA Annual Dinner
VENUE: London, UK
CONTACT: FOSFA, UK.
Tel: +44 (0)20 72835511
E-mail: contact@fosfa.org
Website: www.fosfa.org
14-16 NOVEMBER 2014
69th Annual Convention & International
Conference on Sustainable Technologies
and Futuristic Trends: Oilseeds – Oils
Processing and Surfactants & Expo 2014
VENUE: Hotel Radisson Blue, Agra, India
CONTACT: Prof R K Trivedi, president, OTAI
Central Zone, India
Tel: +91 841 502 4771
E-mail: otai2014@otaicentralzone.org
Website: www.otaicentralzone.org
17-20 NOVEMBER 2014
12th Annual Roundtable Meeting on
Sustainable Palm Oil (RT12)
VENUE: Shangri-La Hotel, Kuala Lumpur,
Malaysia
CONTACT: RSPO Secretariat, Malaysia
Tel: +603 7727 8458
Fax: +603 7727 9458
E-mail: GA@rspo.org
Website: www.rt12.rspo.org
19-20 NOVEMBER 2014
Lignofuels 2014
VENUE: Madrid, Spain
CONTACT: Dimitri Pavly, Active Communications
International (ACI) Europe, UK
Tel: +44 (0)20 3141 0627
E-mail: dpavlyk@acieu.net
Website: www.wplgroup.com/aci/conferences/
eu-eef6.asp
For a full listing of oils and fats
industry events, go to:
www.ofimagazine.com
13 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Diary.indd 1
DIARY OF EVEN TS
26-28 NOVEMBER 2014
10th Indonesian Palm Oil Conference and
2015 Price Outlook (IPOC 2014)
VENUE: The Trans Luxury Hotel, Bandung,
Indonesia
CONTACT: IPOC Secretariat, Indonesia
Tel: +6221 57943852
Fax: +6221 57943853
E-mail: info@gapkiconference.org
Website: www.gapkiconference.org
4 DECEMBER 2014
FOSFA Oils and Fats Dinner
VENUE: London, UK
CONTACT: FOSFA, UK.
Tel: +44 (0)20 72835511
E-mail: contact@fosfa.org
Website: www.fosfa.org
9-10 FEBRUARY 2015
Oilseed Congress Europe/MENA
VENUE: Hotel Arts Barcelona, Barcelona,
Spain
CONTACT: Mark Phillips, The Oilseed Congress
Team, USA.
Tel: +1 978 8878800 x 121
E-mail: conferences@soyatech.com
Website: www.oilseedcongress.com
2-4 MARCH 2015
POC 2015 – Palm & Lauric Oils Price
Outlook Conference & Exhibition
VENUE: Shangri-La Hotel, Kuala Lumpur,
Malaysia
CONTACT: POC2015 Secretariat
Tel: +603 7727 8458
E-mail: poc@bursamalaysia.com
Website: www.pocmalaysia.com
10-12 MARCH 2015
World Bio Markets
VENUE: The Rai, Amsterdam, the Netherlands
Tel: +44 (0)207 099 0600
E-mail: info@greenpowerconferences.com
Website: www.greenpowerconferences.com
15-17 MARCH 2015
81st Annual National Institute of Oilseed
Products (NIOP) Convention
VENUE: JW Marriott Camelback Inn,
Scottsdale, Arizona, USA
CONTACT: NIOP, USA. Tel: +1 202 591 2461
E-mail: niop@kellencompany.com
Website: www.niop.org
17-20 MARCH 2015
International Conference on Coconut Oil
(ICCO)
VENUE: Bangkok International Trade &
Exhibition Centre, Bangkok, Thailand
CONTACT: AgriAsia, Thailand
Tel: +66 (0)2 670 0900
E-mail: agriasia@vnuexhibitionsap.com
Website: www.agri-asia.com/international-
conference-of-coconut-oil.aspx
20-22 APRIL 2015
International Biomass Conference & Expo
VENUE: Minneapolis Convention Center,
Minneapolis, Minnesota, USA
CONTACT: BBI International, USA.
Tel: +1 866 746 8385
E-mail: service@bbiinternational.com
Website: www.biomassconference.com
23-25 APRIL 2015
International Palm Oil Exhibition
(INPALME)
VENUE: Medan International Convention
Centre (MICC), Indonesia
CONTACT: PT International Network,
Indonesia.
Tel: +62 21 36827651
E-mail: pibi@infopibi.com
Website: www.palmoilexhibition.com
3-6 MAY 2015
106th AOCS Annual Meeting & Expo
VENUE: Rosen Shingle Creek, Orlando, Florida,
USA
CONTACT: AOCS Meetings Department, USA.
Tel: +1 217 6934821
E-mail: meetings@aocs.org
Website: www.aocs.org/meetings
3-6 JUNE 2015
European Fat Processors and Renderers
Association (EFPRA) Congress 2015
VENUE: Krakow, Poland
CONTACT: Polish Renderers Industry
Employers Association, Poland
Tel: +48 22 629 73 32
E-mail: biuro@zppu.eu
Website: http://efpracracow2015.com
4-6 JUNE 2015
9th China (Guangzhou) International Edible
Oil & Olive Oil Exhibition 2015
VENUE: China Import and Export Fair Pazhou
Complex, Guangzhou, China
CONTACT: Ms Kimy Xie, Guangzhous Yifan
Exhibition Service Co Ltd, China.
Tel: +86 20 6108 9050
E-mail: kimy.xie@foxmail.com
Website: www.chinaexhibition.com
2-4 SEPTEMBER 2015
2nd High Oleic Oils Congress
VENUE: Paris, France
CONTACT: Fat & Associés, France.
Tel: +33 567339 206
Fax: +33 567 339203
Website: www.higholeicmarket.com/hoc-2015
22/10/2014 10:14
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 I NT E RN ATION AL M ARKET REVIEW

Soyabean surplus weighs

A glut of soyabeans in the USA
and an increase in palm oil
production in Malaysia and
Indonesia is driving world edible

on global edible oil prices

oil prices to their lowest in five
years. John Buckley writes

S
upplies of oil-bearing crops are growing
even faster than the last review anticipated,

CHARTS: JOHN BUCKLEY

backed by record crops of soyabeans and FIGURE 1: CHICAGO SOYABEAN FUTURES
palm oil. While global demand for major
oils is seen expanding by 4.5% or 7.6M
tonnes in the new season that started 1 October,
excess supply will build stocks of oilseeds and oils to
record levels, a prospect that is cutting oil values to
their lowest in over five years. There is not much on
the horizon to spoil the picture of cheap bounty for
consumers as this issue goes to press – maybe some
reductions in winter rapeseed sowings in Europe
and/or some possible weather issues developing for
early South American soyabean planters – against
which stands a bulky global oilseed stock/use ratio
of almost 21%.
About half the increase in this season’s oil
supply is down to increased palm oil production.
Malaysian/Indonesian palm oil crops increased FIGURE 2: VEGETABLE OIL PRICES MONTHLY AVERAGES
faster than expected in the summer, when what
seems to have been an empty threat of dry weather
from the El Niño system loomed. Malaysian output
is currently running about 944,000 tonnes up on
the year, although it seems to have peaked earlier
than usual, in August rather than in October, as it
did last year.
Although demand has increased for palm,
exports have continued to under-perform in the last
quarter and Malaysian shipments are running six
percent lower on the year. Although India has taken
more, big drops have been seen in imports by China
and Pakistan.
At the same time, an earlier forecast boom in
Malaysia and Indonesia’s biodiesel output seems is the fact that palm oil is no longer offering its highest level in eight years, or so the USDA thinks.
to have been significantly overstated or, at best, customary steep discounts versus rivals such as It has taken just a few months for that developing
prematurely talked up. The result has been rising soya, sunflower and rapeseed oil. scenario to knock soyabean values down by 37%
rather than the expected falling stocks in the from their 2014 peaks to their lowest since mid-
producing countries. The prognosis for biodiesel Soyabean glut grabs headlines 2009 – and the decline may not be over yet. Last
has been clouded further by the collapse of Brent issue, we wondered if soyabeans would drop under
crude oil prices to their lowest level in four years, Although consumers around the world use more US$10/bushel. With that barrier already broken,
initially in response to the US shale oil/gas boom palm than any other oil, the growing soyabean some analysts think they could now go to US$8/
and, latterly, amid renewed global demand jitters glut has grabbed even more headlines in the price- bushel or less. Prior to the boom years that began
sparked by a wobbling Chinese economy; political making process. Since the last outlook, the forecast with the crop shortages of 2008/09, CBOT bean
tensions in the Middle East, Ukraine and Russia; for this season’s world soyabean production has futures regularly had long spells in the US$5.50-
and even the fear that the Ebola outbreak in West jumped from 300M tonnes to 311M tonnes, and 6/bushel area (see Figure 1, above). Production
Africa might turn into a wider pandemic. could well go higher still once all the US crop now costs – land, labour, agro-chemicals, etc – have
Although the United States Department of being harvested has been counted. obviously moved up considerably since then which,
Agriculture (USDA)’s palm data is compounded up The most recent official figure for this is about in theory, should have some ‘price-underpinning’
from national marketing years to fit its October/ 107M tonnes – 15.5M tonnes more than last year. effect. The trouble is, as any long-term market
September totals, it shows the direction in which But, based on the stellar yields being seen in observer knows, commodity prices tend to move as
this is likely to lead supply and makes for sober October, some analysts are looking for something much on sentiment/emotion as on such economic
reading. It forecasts 2014/15 carryover for palm closer to 110M tonnes. There is a potential offset fundamentals (and, arguably, soyabeans, like grain
will reach a new record of 8.8M tonnes – about from expected revisions to the USDA’s estimates and sugar, went far too high during the recent
double the average for the previous decade. of US planted and harvested area, but that will not commodity boom, helping to inflate production
Malaysia and Indonesia have responded to materially alter the picture of excess supply. Even costs, especially for land).
the glut by cutting export duties to zero as 2014 with one million tonnes more domestic crush and The near/medium-term fundamentals could pile
draws into its final months and there is industry perhaps one million tonnes to two million tonnes on the gloom for soyabean farmers hoping for a re-
pressure to extend that waiver into 2015. However, more exports, the USA will see pipelines starved run of higher prices. Due to the worse returns from
the inescapable challenge for the big suppliers by last season’s record 94.7M tonnes of disposals key competitor crop maize, Latin American farmers
marketing to the customers – heavily weighted (+10M on 2013/14, filled to overflowing), resulting are expected to plant another record crop over the
towards price-conscious developing countries – in a five-fold increase in ending stocks to their coming weeks and months. If the weather behaves

14 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

John Buckley.indd 1 22/10/2014 10:16

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there, that could add another seven million tonnes FIGURE 3: WORLD OILSEED CARRYOVER STOCKS
to 10M tonnes of extra soyabeans to world supplies
in second half 2014/15 (Feb/Aug). Even if these
crops fall short of forecasts, the Latin American
region – the source of 70% of the world’s soya oil
exports – is carrying in more stock this year than
last. It would take something verging on a weather
catastrophe to cut production enough to change
the outlook for global soyabean surplus. And that
does not even begin to take account of the extra
acres many analysts think the USA will plant next
spring in place of maize.
It begs the question, where will all the soya go?
World production is seen 26M tonnes higher but
crush only 12M tonnes up, the bulk of that increase
in China, Brazil, the USA and Argentina, in that
order. World soya oil demand is, meanwhile, seen
just 1.3M tonnes higher, whereas the extra beans,
if crushed would equate to something closer to five
million tonnes of soyabean oil. Even allowing for
food, direct feed and seed etc, the current global
balance suggests a large cushion of soyabeans to FIGURE 4: WORLD VEGETABLE OIL CONSUMPTION
cope with any unforeseen weather emergencies.
Soya oil prices in Chicago have responded by
dropping to almost 25% from their 2014 highs,
causing the soya/palm premium to collapse to the
mid-US$50s/tonne recently, compared with the
2013 average of almost five times that level. No
wonder, then, that palm exporters have been unable
to capitalise on their lowest prices for five years.

Rapeseed & sunflower prices slashed

Other mainstream ‘soft’ oils like rapeseed and
sunflower oil have also seen their prices slashed as
they followed palm and soya oil prices down (Figure
2, previous page) although sunflower has been
performing something of an about-turn in recent
weeks amid confirmation of the lower production
expected in the former Soviet Union.
The USDA’s combined figure for Russia, Ukraine,
Moldova and Kazakhstan crops has now gone down
to 20.55M tonnes from last year’s 23.23M tonnes.
A drop had been expected in the last review due
to lower Russian plantings but yields seem to have
under performed too, dropping by an average 10%
across the region.
Although Western Europe’s crop is seen close
to last year’s at 8.6M tonnes (8.9M tonnes), global
sunflowerseed output is expected to drop by about
six percent (although it would still be the second
largest ever). That has been reflected in the crude
sunflower oil price ex-tank Europe, which had
dropped as low as €800/tonne in August but has
recently returned to around €865/tonne (although
that is still a bigger drop from the summer of 2013
than seen for rapeseed and soyabean oils).
The USDA assumes sunflower oil production will
be maintained at a fairly high level of 15.4M tonnes
by working into this season’s larger starting stocks
to supplement the smaller crop. It also expects
global sunflower oil consumption to rise by almost
half a million tonnes – which some observers might
think a little optimistic as its premium over its
principal rivals starts to inflate again.
Rapeseed output, on the other hand, has also
turned out a bit smaller than expected this year,
thanks largely to downward revisions for Canada,
recently estimated at around 14.5M tonnes versus
last year’s record of almost 18M tonnes, after a year
of often difficult weather.
Last year’s crop was in considerable surplus,
however, leaving the 2014/15 market with a stock
four times that of the year before (about 2.4M
tonnes) to supplement supply. That should be
enough to meet anticipated Canadian crush and
export demand of about 15.4M tonnes without
causing undue end-season supply tightness –
especially if, as some analysts think, the crop is
actually underrated by about 400-500,000 tonnes.
Meanwhile, the European Union (EU) rapeseed
crop has gone from strength to strength, beating
last year’s bumper 21.1M tonnes by a further 2.4M
tonnes. Given current (3.3%) estimated growth in
domestic EU demand, that should translate into
lower imports.
Elsewhere on the rapeseed map, the former Soviet
countries are expected to come close to last year’s
ample 4.4M tonne crop, while Australia is expected
to see a drop from 3.76M tonnes to 2.45M tonnes
due to weather-reduced yields. Overall, the world
should have enough rapeseed to meet demand for
oil products in 2014/15 without making too large a
dent in this season’s larger carry-in stocks.
In dollar terms, consumers within the Euro-
zone paid relatively more for rapeseed and other
oils because the euro was weak versus the US$ and
other major currencies. However, if the soyabean
glut is as big as some think it will be, dollar prices
for oils across the board will continue to drop,
bringing further benefit to EU consumers, even in
euro terms.
Future influencing factors
! Where will the final US soyabean crop figure end
up? The top end of forecasts could mean further
price cuts.
! South American planting and growing weather
– possibly the most important near/medium-
term factor – a re-run of the droughts seen
two seasons back could spoil farmers’ plans to
expand the crop.
! Europe may sow less rapeseed this autumn for
harvest in 2015 due to falling prices and bans on
neonicotinoid pesticides widely used to protect
this crop.
! Will Russia and Ukraine continue to grow
enough rapeseed to supplement EU and other
users’ crush?
! Top producer Canada had a smaller canola crop
this year after weather challenges that might put
some farmers off planting it (next spring) but it
has carryover stocks to work down.
! Large sunflower harvests in Europe and the CIS
countries seem to be finding ready outlets for
the oil, not only in Europe but globally, as lower
prices than usual combine with its perceived
‘premium quality/healthy’ image (although
suppliers of the other three major oils frequently
claim similar attributes for their own products).
! Can palm oil capture more trade as its price
sinks? That may be a challenge if prices of other
oils continue to follow suit?
! Top importer India reportedly needs more edible
oils from overseas in the wake of domestic
oilseed crop shortfalls. "
John Buckley is Oils & Fats International’s market
correspondent

15 OFI – OCTOBER/NOVEMBER 2014

John Buckley.indd 2 22/10/2014 10:16

 C H IN A

PHOTO: SALAMANDRA86/DREAMSTIME.COM
GLYCERINE IS USED IN THE MANUFACTURE OF SOAPS, COSMETICS AND BEAUTY CARE PRODUCTS, EXPLOSIVES AND TOBACCO PRODUCTS

Glycerine market explodes

M
uch has been written about the effect with estimates for 2014 constructed by a linear
The Chinese glycerine market that biodiesel production has had on extrapolation of the imports for the January to July
is set to expand to almost one glycerine prices, but there has been period until the end of the year. By this measure,
limited mention of the influence 2014 imports of glycerine into China look likely to
million tonnes in 2014, fuelled that China has had in absorbing increase by about 30% compared to 2013.
by exports to China of good much of the additional glycerine produced by the On the other hand, domestic production
quality crude glycerine from biodiesel industry during the last decade. of glycerine in China is not increasing on the
Exports to China of unexpected and good same scale. Several papers have been published
lo l so rces chie r entin quality crude glycerine is rapidly expanding the debating the viability of biodiesel production in
and Indonesia. Jonathan Chinese market. A detailed picture of the state of China, including an October Global Agricultural
imports can be seen in Table 2 (below), based on Information Network (GAIN) report issued
Hemming, CEO of HBI, writes data from Chinese customs. The table shows crude in October, which provides an informative
glycerine volumes converted to 100% concentration assessment of agricultural markets for the US
federal government. The report notes that the
TABLE 1: ESTIMATED CHINESE DOMESTIC PRODUCTION, IMPORTS AND CONSUMPTION OF consumption of diesel in China in 2012 was 200bn
GLYCERINE IN ‘000 TONNES, 2005-2014 litres. With a growth of six percent/year expected,
Domestic production Imports of crude Approx. consumption this would imply a present market size of diesel
of crude glycerine & refined glycerine of refined glycerine* of about 200M tonnes/year. Should the Chinese
2005 60 40 100 government go ahead with its B5 mandate, which
2006 70 100 170 was published as a standard in 2010, it would open
2007 180 186 366 a mind-boggling 10M tonnes/year market, with one
million additional tonnes of glycerine required.
2008 125 246 371
2009 115 350 465
B5 standard provides guidance only
2010 205 368 573
2011 202 438 640 However, such calculations are based only on
2012 162 489 651 speculation. The B5 standard was intended as
2013 184 566 750 guidance for automobile constructors and nothing
2014 199 719 918 indicates that the government intends to enforce it
*Exports of glycerine from China are negligible and this estimation takes no account of stock movements, which are not as a mandate. Moreover, as was discussed at the 11th
available in China. Oleochem Outlook 2014 conference, held 2-3 July !
Sources: HBI China, Chinese Customs Office

TABLE 2: IMPORTS INTO CHINA OF CRUDE AND REFINED GLYCERINE

2009 2010 2011 2012 2013 Jan-July 2014 Est 2014
Crude glycerine 237,600 243,200 316,000 357,600 467,969 344,236 590,119
Refined glycerine 112,000 125,000 122,000 131,000 98,562 75,350 129,171
Total 349,600 368,200 438,000 488,600 566,531 419,586 719,290
Source: Chinese customs data

16 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

China Glycerine.indd 1 22/10/2014 10:09

 C H IN A

" 2014 in Qingdao, China, Chinese administrative TABLE 3: HBI PRODUCTION ESTIMATES FOR CHINESE GLYCERINE
support in terms of biofuels is strictly limited to
Type of feedstock Tonnes
non-food feedstocks.
Biodiesel producers will struggle to utilise the Production of glycerine from fatty acids 145,000
existing supply chains of used cooking oil (UCO) Production of glycerine from fatty alcohols 29,000
unless biodiesel is offered at a premium above Production of glycerine from soaps 10,000
existing applications (and European double- Production of glycerine from biodiesel (UCO-based) 10,000
counted producers). There are just five small Production of glycerine from methyl ester sulphonate (MES) 5,000
biodiesel operations running in China and HBI Total 199,000
estimates that no more than 100,000 tonnes of Source: HBI
domestically-produced biodiesel will be available
in 2014. In addition, large volumes of biodiesel are
being shipped from China to Indonesia. production that could compete with the price of finally look more enticing. Cheap refined glycerine
crude palm oil (CPO). HBI’s estimates for domestic now coincides with better ECH prices. Epoxy resin,
Reserve stocks may play role production of glycerine for 2014 are shown in Table the main application for ECH, is in demand again.
3 (above). Demand should pick up in earnest over the next
Dorab Mistry, director of Godrej International and a The 2014 consumption in China of glycerine at few months and producers of ECH derived from
respected vegetable oil price forecaster, points out 918,000 tonnes is remarkable in the sense that all glycerine have announced that they soon expect
that the Chinese Reserve has been holding several the glycerine used is refined glycerine. Around 40% to reach 50% of capacity utilisation, which is over
million tonnes of rapeseed oil. of the world’s refined glycerine is now consumed in 200,000 tonnes/year. These levels of production
This determination to hold enormous reserves of China, suggesting that Chinese end-users of refined have never before materialised.
edible oil shows that biodiesel has no role to play glycerine have widened the geographical reach of
in the minds of the planners of China’s economy. their marketing. For instance, one can now find Glycerine prices decrease
Paradoxically, if the Reserve holds onto its stock for Chinese triacetin producers offering product to a
too long, the quality will deteriorate and biodiesel first-class European tobacco producer, which is one Meanwhile, prices for all grades of glycerine have
may become the only possible application for the of the most difficult accounts to crack. Likewise, been decreasing for a year. As can be seen in Table
oil reserves. epoxy resin made from epichlorohydrin (ECH) 1 (previous page), the downward trend of this price
Domestic production of fatty acid, fatty alcohol manufactured from glycerine is finding its way into cycle has not stretched on for so long since 2007,
and methyl ester sulphonate is similarly capped Europe in increasing volumes. which explains why many Chinese trading houses
by the structural disadvantage that China has no ECH is more than ever a key downstream are tempted to speculate that prices could soon
abundant raw material available for oleochemical application for glycerine and market conditions increase.
However, everything is currently pointing
TABLE 4: REFINED GLYCERINE SPOT PRICES IN CHINA 2007-2014 towards further price devaluation. Nevertheless, it is
Import price of 99.5% pharma Price of 95% tech. grade important to point out that Chinese trading houses
have the capacity, simply based on speculation, to
grade refined glycerine in refined glycerine in RMB/
take out very large volumes of glycerine from the
US$/tonne CIF CMP* in drums tonne in bulk delivered** market.
2007 QII 725 6,750 As can be expected in a market where margins
QIII 1,050 8,750 are very thin and prices fast decreasing, there
QIV 1,820 11,750 have been many unfortunate episodes of defaults
2008 QI 1,600 14,750 by Chinese customers. Oleoline is part of the HBI
QII 1,400 7,800 Group that also comprises HBI China. HBI China
has had a remarkable performance during this cycle
QIII 750 5,800
and has limited customer defaults to a handful of
QIV 400 3,300
cases. In addition, a Herculean performance to
2009 QI 650 4,700 convince customers to accept 95% of discrepancies
QII 600 4,300 on documents was successful. By HBI’s reckoning,
QIII 500 4,100 such discrepancies occur in about 30% of letters of
QIV 500 4,000 credits and are now the usual source of contract
2010 QI 650 4,500 defaults.
QII 560 3,900 The best quality vegetable 80% minimum crude
glycerine price has decreased from US$450/
QIII 500 3,800
tonne CIF Chinese main ports in October 2013 to
QIV 1,000 5,400 US$240/tonne CIF Chinese main ports in October
2011 QI 900 5,750 2014. Refined glycerine prices have decreased
QII 700 5,000 in parallel. The best quality Malaysian refined
QIII 700 4,500 glycerine is sold below US$650/tonne CIF Chinese
QIV 675 4,500 main ports in drums today, with many sellers
2012 QI 635 4,500 happy to agree deals at lower values before prices
decrease further. HBI pegs the average price level
QII 700 4,500
of purchases of pharma quality refined glycerine by
QIII 800 4,500
the Chinese in September 2014 at around US$670/
QIV 825 4,600 tonne CIF Chinese main ports in drums.
" 2013 QI 860 4,900 As vegetable oil prices are set to remain relatively
QII 900 5,300 cheap in the medium term, discretionary blending
QIII 930 5,400 of biodiesel globally will result in ongoing price
QIV 900 5,300 erosion in all glycerine markets including China.
2014 QI 850 4,800 Nevertheless, with very difficult trading conditions
in China, defaults will continue to be a major risk. !
QII 800 4,500
Jonathan Heming is the CEO of HBI, an international
QIII 670 4,000 brokerage company that moves over 300,000
Source: HBI *Chinese main ports **Includes 17% VAT
tonnes/year of glycerine

18 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

China Glycerine.indd 2 22/10/2014 10:09

p19_POC_OFI_Digital_Ads_feature.qxp 10/23/14 2:16 PM Page 20

19 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com


Eliminating trans fat
Food manufacturers must look at alternatives to partially
hydrogenated oils (PHOs) as the USA’s Food and Drug Administration
(FDA) moves to ban them. Charlotte Niemiec looks at what could be
used in their place
A
s the US government prepares to remove
generally regarded as safe (GRAS)
status for foods containing trans fat,
food manufacturers that use edible
oils and fats must also prepare for the
change. The main culprit for trans fat is partially
hydrogenated oil (PHO), found in crackers, cookies,
cakes, frozen pizzas, snack foods such as popcorn,
fast food, vegetable shortenings, margarines and
coffee creamers.
Using PHOs in food has many advantages
for food manufacturers. The process of partial
hydrogenation stabilises vegetable oil, increases
product shelf-life and decreases refrigeration
requirements. Many baked foods require semi-solid
fats to suspend solids at room temperature and
PHOs have the right consistency to replace animal
fats such as butter or lard at a lower cost. They
are also relatively inexpensive when compared to
tropical oils such as palm oil or coconut oil.
However, on the basis of scientific evidence,
the finger of blame is being pointed at trans fats
as the cause of a rise in coronary heart disease
and other adverse health effects. According to
data from the World Health Organization (WHO):
“Consumption of industrially-produced partially
hydrogenated vegetable oils has been associated
with an increased risk of cardiovascular disease,
infertility, endometriosis, gallstones, Alzheimer’s
disease, diabetes and some cancers.”
Many countries around the world have taken steps
to address the level of trans fats found in their food.
Iceland has implemented a total ban on trans fats,
while Denmark and Sweden have effectively banned
them by implementing a total two percent trans fat
limit over total fat found in products. Switzerland
followed Denmark’s lead and implemented the
same ban in 2008. In 2011, Argentina launched
a campaign that also aims to bring the maximum
level of trans fats over total fats to two percent by
2014. In 2007, the Food Standards Agency (FSA) of
the UK issued a news release stating that voluntary
measures within the country to reduce trans fats in
food had already resulted in safe levels of consumer
intake.
However, according to the Food and Drug
Administration (FDA) of the USA, the average
American still consumes 5.8g/day of trans fat
and labelling of trans fat is not as iron tight as
other countries; trans fat levels of less than 0.5g/
serving can be listed as being trans fat free on the
food label, but servings of 0.5g can quickly add
up to significant levels without the consumer’s
knowledge.
While there has been no official announcement
20 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Trans Fats Feature.indd 1
USA
and, crucially, no timeline, the FDA is nevertheless
expected to remove GRAS status for trans fats,
which would have the effect of virtually eliminating
them from the US food supply. Food manufacturers,
therefore, will soon have to consider
alternatives. One website, www.tfx.org.uk
(TFX) campaigns against the use of
trans fats in food and offers some
suggestions for alternatives for the
food industry.
Natural products
Instead of using chemically modified
fats and oils, food manufacturers could
revert to natural fats such as butter or
lard (see OFI, April/May, ‘Bringing
butter back’, p22) which contains
small amounts of natural trans
fats but also small amounts of the
healthful lauric acid, conjugated
linoleic acid (CLA) and vaccenic
acid, according to TFX. The
drawback for food manufacturers
is that butter is expensive and
may not be as effective as PHOs.
Butter fat is another
alternative that is cheaper than
butter. It is mostly derived from
‘surplus’ butter by removing
the water and protein. As a
semi-hard fat, it substitutes
directly for hydrogenated oil and
has good keeping properties;
its fatty acid composition is
roughly half saturates and half
monounsaturates. Companies
using it in their products, according
to TFX, including Tesco in its own-
brand dark chocolate and Nestlé in
its Kit-Kat bars.
Animal fats, claims TFX, are
also an excellent alternative, as the
human body has proved its ability to
process them with no ill effects. The
PHOT
website notes: “The harder animal fats,
O:SK
such as beef fat and venison fat, have a
YPIXE
high proportion of longer chain saturates
such as stearic acid, which is cholesterol
L/
DREA
neutral, and only traces of myristic acid. As
MSTIM
for palmitic acid – a saturated fat that raises
cholesterol, found in all animal fats – [the]
E.CO
body readily converts surplus carbohydrate in
M
the diet into palmitic acid for energy storage.
Cutting our dietary intake of palmitic acid will,
22/10/2014 11:03
 USA

bodies such as the WHO, FDA and American Heart

Association (AHA) have warned against excessive
consumption of coconut oil because of its high level
of saturated fat.
Even palm oil, which also contains a high level of
saturated fat, may have been unfairly stigmatised,
TFX argues. The website cites a submission by
the Malaysian Palm Oil Council (MPOC) to the
WHO, which argued that “the saturated fatty acid
palmitic acid, found in palm oil, behaves similarly to
or better than unsaturated vegetable oils in terms
of cholesterol levels.” Indeed, palm oil appears to
have been the PHO alternative of choice thus far for
manufacturers.
blood Nevertheless, from an environmental perspective,
s e r u m there are concerns that the use of palm oil in food
cholesterol which, products will contribute to a rise in deforestation in
in turn, does not directly palm oil-producing regions, such as Indonesia and
relate to cholesterol in tissues Malaysia, in order to clear land on which to produce
or cholesterol laid down in a plaque on the crop.
the inner surface of arteries, which is what is The obvious solution is simply to use vegetable
really dangerous to health. The creation of artificial oils such as rapeseed, corn, olive or soya. However,
cholesterol plaque is also stimulated by oxidisation, there are drawbacks to using these. TFX explains:
therefore, do often caused by free radicals – and saturated fats “Some liquid vegetable oils ... contain up to five
little to lower provide some protection against free radicals.” percent trans fat as a result of trans isomerisation
levels of palmitic Other advantages of using animal fats include of alpha linolenic acid (ALA) during prolonged
acid in our bodies as long additional health benefits, such as the levels of high temperature refining, deodorising and other
as we eat a carboyhydrate- tocopherols (natural antioxidants better known processing ... While the use of liquid oils is a good
rich diet.” as Vitamin E) and other fat-soluble vitamins idea in a domestic culinary context, the food
However, animal fats and mineral nutrients. Animal fats tend also industry often needs long shelf-lives and, thus, the
also contain cholesterol, to be chemically stable and can, therefore, be chemical stability that hydrogenation confers to
which is the main cause used for frying and cooking without significant unsaturated vegetable oils.
of heart disease that the deterioration. Hydrogenation is normally applied mainly in
FDA is attempting to However, the obvious drawback of using animal order to stabilise certain fatty acids within vegetable
curb with its ban on fats is that they cannot be used in vegetarian oils (mainly ALA), which are prone to rancidity.
trans fats. But, says products, which vastly limits their use and does But, in the case of frozen food, this should not be
TFX, “dietary not make them a viable alternative for many food a significant factor, since the food is conserved by
cholesterol only manufacturers. low temperature. There is little obvious reason for
correlates using hydrogenated oil rather than liquid oil in
weakly Tropical and other oils – or none? frozen food products unless very long storage times
w i t h are anticipated.”
There has been considerable media focus recently What about removing fats completely? Various
on the health benefits of coconut oil, another companies, such as FiberGel Technologies, are
alternative to trans fats. Various news outlets are focusing on this. FiberGel offers Z-Trim – a ‘zero
claiming that coconut oil has been vilified due to calorie’ gel made from corn bran fibre and a few
its high level of saturated fat, but that this is not additives.
necessarily fair. TFX claims that coconut oil is a The company claims that Z-Trim can replace fat
good source of the medium-chain saturated in processed foods volume for volume, up to 50%
fatty acid lauric acid – a protective of the original fat quantity, without any difference
substance found in mother’s milk in taste or mouth feel. While it cannot replace all
that boosts the immune system – the hydrogenated fat in a product, it could make a
and that coconut oil is loaded worthwhile contribution to the reduction of trans
with antioxidants, protects fats, while also reducing total fat and thus the
against heart disease and calorific content of products.
cancer and is active
against pathogenic Mixing, manipulating and moulding
viruses, bacteria
and fungi. Another option is to use fully hydrogenated oil
However, rather than partially hydrogenated oil, but mix it
health with unhydrogenated oil.
This was flagged up as
an alternative by Robert M Reeves, president
of the Institute of Shortening and Edible
Oils (ISEO) in 2003 to the Washington
Post: “One trans fat alternative involves
blending fully hydrogenated oil with unhydrogenated
oil, neither of which contains trans fats, resulting in
a final product that contains no trans fats but that
may be identified as ‘partially hydrogenated’ in the
ingredient statement.” This would, as TFX notes,
result in the mechanical and fluid properties that
PHOs provide. !

21 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Trans Fats Feature.indd 2 22/10/2014 11:03

 USA

" Interesterification offers another alternative, University of Iowa, which has produced soya with
as noted by the American Soybean Association one percent linolenic acid content, as compared
(ASA): “Instead of partially hydrogenating soya
oil, food companies may be able to meet some
of their specific needs by using a process called
“If the oil from to seven percent in normal soya. At this low level,
there is no longer any need for hydrogenation.”
Biotechnology company Dow Agrosciences is also
interesterification, which rearranges the oil’s fat
molecules without adding hydrogen molecules,
producing a product with few trans fatty acids.
traditional oilseeds focusing on advanced oilseeds and has developed a
novel line of canola named Nexera. This has been
developed to produce an oil – ‘Natreon’ – which,
These alternative ways to process soya oil may
slightly increase the cost of the finished product,
but soya oil is relatively inexpensive and produces a
does not have the according to the company, satisfies the need of
the food industry for stability and shelf life,
without the need for hydrogenation, and which
healthy product that’s low in saturated fat.”
One company offering such products to the
market is the Danish enzyme company Novozymes,
qualities the food contains a fatty acid profile that is beneficial to
human health.
The company says of the product: “Like

industry needs, why

which produces Lipozyme TL IM, an enzyme to
make trans fatty acid-free bakery shortenings
and margarine via enzymatic esterification and
interesterification. By using the enzyme, the
company says, oil processors can control the
conversion and no trans fatty acids are produced.
Perhaps the most exciting and forward-thinking
not change the plants
approach is the production of advanced oilseeds
through biotechnology. As TFX asks, if the oil from
traditional oilseeds does not have the qualities the
and the seeds they
food industry needs, why not change the plants and
the seeds they produce, instead of changing the oil?
This can even be done by using selective breeding
produce, instead of
rather than genetic modification.
According to TFX: “In the case of soya oil, widely
used in the USA, the principal unstable ‘fatty acid’
changing the oil?”
is alpha linolenic acid (ALA). This has prompted
soya breeders to produce seed with a very low
linolenic acid content. Leading the field is the State
traditional canola oil, Natreon contains about seven
percent saturated fat, the lowest of any vegetable
oil. The unsaturated fat profile of Natreon also is
desirable with more than 70% monounsaturated fat
and a higher omega-3 polyunsaturated fat content
than most of the PHOs it can replace.
In addition to health benefits, monounsaturated
fat gives Natreon canola oil natural stability,
making it ideal for high-heat applications, such as
frying, and for products that require extended shelf-
life, such as baked goods and snack foods. Natreon
canola oil has a neutral flavour and preserves the
good, clean taste of foods. It also gives fried foods a
light, crisp texture, which still is number one with
many consumers.”
This plethora of options is encouraging for the
food industry; while one alternative may not work,
another just might. !
Charlotte Niemiec is OFI’s assistant editor

22 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Trans Fats Feature.indd 3 22/10/2014 11:03

 TR ANS POR T, LOGISTIC S, STORAGE

I
n May 2014, the European Commission (EC)

PHOTO: SHOTSSTUDIO/FOTOLIA.COM
published revised legislation replacing the
1996 derogation given to the oils and fats
trade from the full dedication required for
transporting foodstuffs. Although the previous
cargo list had been updated in 2004, new legislation
was required as the original dedication directive
had been withdrawn. Fortunately, the new rules are
essentially the same as the previous ones except for
the List of Acceptable Previous Cargoes.
The new list is the result of work carried out by
the European Food Standards Agency (EFSA) and
is based on thorough consideration of the hazards
that would occur from contamination of an edible
oil by a previous cargo. The risk analyses were
based on criteria used by the Scientific Committee
on Food for the original list and also on criteria
devised and accepted by the Codex Alimentarius
Commission in 2009. EFSA also introduced the
concept of minor components remaining in the
materials from the manufacturing process, thus
making their investigations more realistic. All the
EFSA opinions and the EU legislation are freely
available on the internet.

Previous cargo rules change

Major changes to previous cargoes
There are major changes to the lists. These include
the addition of several products requested by the
industry since the publication of the 1996 list
and subsequently added to trade lists such as the
FOSFA Acceptable List. Not all the latest products
have been added as several were not considered by
EFSA for reasons discussed later. Examples of the
new products are: ammonium nitrate solution,
calcium nitrate solution and isobutanol. Mixtures
of fatty acids, fatty alcohols and fatty esters have
also been added, but have been restricted to those
sourced from edible types of fats and oils. Care must
be taken when shipping these derivatives from non-
edible oils such as jatropha oil, as this becomes
more common. EFSA has also noted the problem
that arose when used cooking oil (UCO) from
public collection sites was incorporated into animal
feed and they have added the restriction to these
derivatives of “not contaminated with compounds
of toxicological concern”.
There are also some products that remain on
the list, but which have been modified from the
previous list. EFSA wished to restrict the types of
animal, marine and vegetable oils to those that are
currently shipped within the trade. In other words,
they did not want to allow any new types of oils to be
carried as previous cargoes without those oils being
subjected to hazard analysis.
To ensure this was the case, EFSA made use
of the work carried out by the Joint Food and
Agriculture Organization (FAO)/World Health
Organization (WHO) Expert Committee on Food
Additives (JEFCA) for the International Maritime
Organisation (IMO) and restricted them to those
that are allowed by IMO to be carried in bulk by sea.
These are listed in the IMO publication MEPC.2/
Circ and are the names of the oils that must be
listed in ships’ documents for inspection by local
port state control.
The new list clears up the frequently asked
question of whether fatty acid methyl esters (FAME)
were included in the 2004 list. It now states “any
ester produced by the combination of the listed
fatty acids with any of the listed fatty alcohols as
well as methanol and ethanol”, meaning that all
Changes to the previous cargo list published in May 2014 by the
European Commission (EC) generally favour the edible oils and fats
industry. John Hancock of FOSFA writes
commercial FAMEs and fatty acid ethyl esters
(FAEEs) are allowed.
Nevertheless, shippers must remember that
the toxicological status of a previous cargo is
determined by that of the most toxic component,
however minor the component may be.
The types of molasses have also been restricted
to those produced from sugarcane, sugar beet,
citrus and sorghum but, as this includes almost
all the commercial molasses shipped in bulk, this
should not be a problem.
One modification that should help in the position
of tankers for EU destinations is the removal of the
restriction for aqueous solutions such as potassium
and sodium hydroxide, which are now accepted as
previous cargoes in their own right, rather than
being transparent cargoes. EFSA accepted that
modern cleaning regimes and practice made this
previous restriction unnecessary.
There have also been some products that have
been removed from the old list, for example,
calcium lignosulphonate. The reason for this is
that the terms include products with a wide range
of specifications and thus full risk analyses were
not possible. It is likely that products with fixed
specification ranges will be accepted by EFSA in
future.
FOSFA and NIOP differences
There are still some differences between the FOSFA
and National Institute of Oilseed Products (NIOP)
lists and the new EU list. The major omission is ethyl
tertiary butyl ester (ETBE), which is a “big mover”
in shipping terms. This material is a replacement for
methyl tert-butyl ester (MTBE) in motor fuel and is
favoured for its superior environmental footprint.
It is recognised that this product has a lower
hazard profile with respect to previous cargoes but,
unfortunately, it has not been evaluated by EFSA.
The changes in the EU are a result of the adoption
by Codex Alimentarius of a set of criteria that were
used to develop its own list of acceptable previous
cargoes. During the development process within the
Codex Committee on Fats and Oils, members were
asked for their opinion on all the substances on
the Draft List, which was based on the FOSFA and
NIOP trade lists. In order to answer this request, the
EC asked EFSA to look at the Codex criteria and
lists. Since ETBA was not on the FOSFA list at the
time that the draft Codex list was drawn up, it was
not included in the EFSA work. However, following
discussions with the EC, it is probable that a note
describing the procedure for adding a substance to
the EU list will be posted on their website in the
near future.
This will require the production of a data
dossier, including toxicological data, giving the
complete information to enable EFSA to formulate
an opinion. FOSFA is willing to work with any
manufacturer or shipper to follow this procedure.
In summary, previous cargo lists are important
because they reduce the risk to consumers from
any contamination from previous cargoes carried
in chemical tankers. The new EU list of acceptable
previous cargoes has some important changes
from the 2004 list, most of which are favourable
to the industry. The products have been subjected
to a consistent set of criteria to produce reliable
hazard profiles. The expert opinions have been
freely published and it is likely that they will form
the basis of a fully harmonised list in the not-too-
distant future. !
John Hancock is FOSFA’s technical manager

23 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Previous cargo regs.indd 1 20/10/2014 16:51

 TR ANS POR T, LOGISTIC S, STORAGE
PHOTO CAPTION: WIKIPEDIA.COM
FLEXITANKS ARE HUGE, FOLDAWAY PLASTIC BAGS FOR THE EASY TRANSPORTATION OF EDIBLE OILS INSIDE SHIPPING CONTAINERS
Flexitanks: a bag for life
le it n s o er fin nci l n environ ent l v nt es
shippin vol es n llowin or etter s nit tion o oils n ts
owever etter st n r s re re ire to prevent costl le
re n in he n lie en ll e ine the ch llen es
ollowin the ont iner wners ssoci tion on erence hel in
r on l the manufacturing process and testing of flexitanks
F
lexitanks are a developing innovation
for moving oils and fats around the
world, and they were the key focus for
delegates gathered at the Container
Owners Association (COA) conference
in Hamburg, Germany, in July. These huge,
impenetrable and foldaway plastic bags, that fit
inside shipping containers, are particularly useful
for transporting oils and fats as they allow for better
sanitation and easier transportation.
The COA’s flexitank manager and keynote
speaker, Chris Thornton, explained that usage of
flexitanks for all kinds of products and commodities
had increased significantly over the last decade.
In 2002 there were only 40,000 shipments/year
but, in 2014, it was expected that some 500,000
consignments would use flexitanks.
Damien McClean, founder and CEO of Ireland-
based global firm SIA Flexitanks, views flexitanks as
being ideally suited for the transport of oils and fats.
Indeed, back in 1999, McClean designed, developed
and introduced the first multiply disposable
24 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Flexitanks Feature.indd 1
i isin
es
polyethylene flexitank, which is ideal for such liquid
and viscous cargoes.
“Before flexitanks came along, you would use a
variety of drums or a time container. If you send a
time container from Turkey to China, for example,
and it cost you US$3,000 to send it there, it is going
to cost you the same to bring it back empty,” he
says. “The benefit of the flexitank is that it uses a
standard shipping container and, when you strip the
flexitank, the shipping container can then be used
to carry TVs or washing machines, for example. So
really it is a one-way cost system.”
Helping the world and the wallet
Flexitanks offer both financial and environmental
benefits to businesses. Many industries have
realised that substantial savings can be made
through the reduced weight of flexitanks, as they do
not utilise traditional glass and plastic bottles and
are therefore capable of carrying higher volumes of
liquid than bottles.
McClean explains: “The density of oil at 0.9
[specific gravity] in general is really suited to
flexitanks because you can get 24,000 litres in
there, whereas if you load drums you are only going
to get 17 or 18 tonnes [or about 18 thousand
tonnes] in there. That is why oils are practically
suited towards shipment with flexitanks.”
For instance, Olive Oil Market, an olive oil
wholesaler based in Greece, offers three shipping
methods: drums, heavy-duty plastic barrels with a
capacity of 58 gallons (220 litres); totes, which are
plastic containers inside steel cages with a capacity
of 275 gallons (1,014 litres); and flexitanks, with a
capacity of 5,812 gallons (22,000 litres).
Besides the considerably increased capacity,
flexitanks offer two main advantages over the
more conventional methods, drums and totes:
their optimisation of loading – 20% higher than a
drum or a tote; and their compatibility with olive
oil, particularly, in that the materials used do not
damage the oil’s quality and properties.
Nevertheless, McClean says the single biggest
product being shipped by flexitanks today is palm
oil, mostly from Malaysia and Indonesia. “Palm oil
is the biggest, then wine, fruit juices, and natural
and synthetic latex, which comes out of Vietnam,
Indonesia, Malaysia and southern Thailand.”
According to statistics from 2013 presented
by the COA at this year’s conference, Asia – with
50% of cargo volumes – was the biggest regional
market for flexitanks, whereas Europe was at 15%,
North America eight percent, South America seven
percent and the rest of world at 20%. Edible oils
and base oils each used 20% of the flexitank market
division in 2013.
“You do have rapeseed oil movement”,
says McClean. “And, if you go down into the
Mediterranean, you can ship a lot of different
types from pomace grade right up to extra virgin
olive oil. And, even in North Africa, from Morocco,
Tunisia, you can ship a lot of vegetable or olive
oil. Even Ukraine – that is another country that
utilises flexitanks for transport of its vast amounts
of sunflower oil.”
Better specs needed to stop leakage
At the Hamburg conference, a new specification for
was introduced to delegates. Known as PAS 1008,
developed by the British Standards Institution (BSI)
it will enable flexitank manufacturers to certify the
quality of their products.
“There are numerous standards throughout the
container shipping industry but, until now, there
has never been a standard to aid the manufacture or
testing of flexitanks, which is important,” explains
Thornton. “A damaged flexitank, for instance, can
result in large cost implications due to leaking
cargo. In view of that, the flexitank industry
recognised the need for better-defined criteria for
this growing sector of the bulk liquid packaging
industry.”
The Federation of Oils, Seeds & Fats Associations
(FOFSA) participated in the development of
the standard. “The main problem in the use of
flexitanks is that they are produced with a wide
range of qualities and prices. The lower quality bags
are prone to leak and, if the tank is at a high level
in a container carrier, the damage to the containers
on the lower levels can be significant,” said a FOFSA
note.
20/10/2014 16:49
 T R ANS POR T, LOGISTIC S, STORAGE
The standard includes minimum requirements
for the material properties of the flexitank film and,
where fitted, the outer sleeve; the leak tightness of
the loading/discharging valve(s); and the system’s
resistance to an impact. Under the standard,
flexitanks are tested using rail impact tests – a
system where a train wagon carrying a flexitank is
driven into another wagon and the flexitank is then
tested for leaks or other damage.
Alongside the launch of the PAS 1008, Thornton
says a key development for the industry was the
international specification for flexitank operations,
which has been developed by the COA.
“Poor quality manufacturing or a lack of testing
can make flexitanks more susceptible to damage,
resulting in lost or damaged stock as well as the
resulting clean-up,” he explains. “In addition
to concerns regarding leakage, some shipping
lines have been reluctant to carry flexitanks.
The pressure placed on the sidewall panels by
incorrectly specified or loaded flexitanks can
result in the freight container bulging beyond
accepted ISO tolerances and can lead to permanent
deformation.”
To counteract this, the COA drew up a
recommended Code of Practice in 2009 to help
improve standards in the manufacturing and
operation of flexitanks. An expert steering group
provided technical expertise through reviewing the
drafts and resolving comments submitted during
public consultation.
Since then, the COA has updated its Code of
Practice twice. The latest version, released in
September 2011, stipulates specific and detailed
25 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Flexitanks Feature.indd 2
rules for the standardisation of flexitanks’ quality.
For example, the code states that “the flexitank
shall be marked with the following information
(which must be visible when the right-hand door
of the container is opened): a. Unique flexitank
number; b. Manufacturer’s name and/or recognised
logo.”
It also sets rules for insuring the flexitanks and
states that “there should be insurance cover for not
less than US$5M per single incident”.
The code requires flexitank operators to create
emergency plans and flexitank manufacturers and/
or operators to prepare manuals for fitting, loading
and discharge of the tanks. As of June 2014, there
are 49 companies from around the world who
produce flexitanks that have been certified as
compliant with the COA’s code of practice.
Keeping oil warm for easy discharge
One of the big challenges flexitank manufacturers
face is the problem of reheating certain products
when they arrive at their destination.
“For example, palm oil taking a ticket into
Europe for the winter can take two days to heat
up after travel, whereas, if you could heat it up in
two hours, that would really be a game changer
and there is a lot of effort going into that,” says
McClean.
His company has specially designed steam
heating pads to fit under certain flexitank models,
which are capable of evenly reheating the cargo
before unloading. “This heater pad is made to
allow liquids that have a low melting point and can
solidify when subjected to low temperatures, to be
discharged using either steam or hot water as a heat
source,” he explains.
Sun FlexiTanks, a company based in India,
has also produced a heating pad that can safely
transport oils in cold temperatures. The heating
pad is disposable and is made of two rubber tubes,
which stream hot water throughout the pad. They
are then placed beneath the flexitanks during
transport and engaged when the tank arrives at its
destination.
Shamrock, another flexitank company based in
Cyprus, produces a similar disposable heating pad
that can heat up a container of liquid – for example
palm oil or olive oil – in about four to six hours.
The reason heating pads are necessary, according
to Shamrock, is that “at low temperatures, a high-
viscous product would become sticky and not at all
easy to discharge”.
Additionally, “alongside EU certifications, our
flexitanks are also certified for the transport of halal
and kosher products. This gives us great flexibility,”
adds McClean.
Furthermore, the development of a dependable
refrigerated flexitank is an innovation that will give
much impetus to flexitank usage, says McClean. His
company has already utilised refrigerated flexitanks
to ship milk from Australia. “Basically, you can
load a flexitank in any country that’s got a port.
You can load countless numbers of non-hazardous
products into a flexitank. The market is so vast, it’s
mindboggling.”
Breandáin O’Shea and Kylie Kendall are freelance
journalists. !
20/10/2014 16:49
 TR ANS POR T, LOGISTIC S, STORAGE

R
eaders based in the United Kingdom

PHOTO: KOOLE TANK STORAGE

may recall some rather distressing
reports in the early part of last year
of seabirds washed up on the south
coast coated in a sticky substance they
had apparently picked up in slicks in the English
Channel.
It was initially believed that the substance in
question was palm oil, but it was later identified as
polyisobutylene (PIB), a product shipped in large
volumes and used in a wide variety of products,
including cosmetics, grouting materials and
additives for lubricating oil.
While the source of the slicks was never identified,
it was widely assumed to be a ship discharging
residues, and pressure from environmental groups
led the International Maritime Organization
(IMO) to agree to an amendment to the carriage
requirements for this product. Polyisobutylene
has been carried for many years as ship type 2 and
pollution category Y, meaning that residues can be
discharged into the sea providing certain conditions
are met, such as the distance from shore, depth of
water and speed the ship is travelling.
It was ascertained that it was a form of the
product with high molecular weight that had caused
the problems and so it was agreed that, henceforth,
there should be two entries for polyisobutylene, one
with a molecular weight equal to or lower than 224
with the current carriage requirements and one
with a molecular weight higher than 224, which
should be pollution category X. This will mean that,
following discharge of the higher molecular weight

Toughening discharge rules

variety, the tanks will have to be pre-washed before
the vessels leave port, with the wash water being
pumped ashore.

Vegetable oils on the beach

It would appear that this may simply be the tip of
the iceberg, however, with concern growing about
substances such as vegetable oils and waxes washing
up on beaches on Baltic and North Sea coasts over
the past year or two.
While these might not be considered “classic”
pollution incidents – and it is still not clear whether
they are the result of legal or illegal discharges –
they impair the recreational and tourism values
of beaches and coastlines and society bears the
expense of the clean-up, which can often run into
hundreds of thousands of euros.
A group of European countries accordingly
made a joint submission to the first session of the
IMO’s new Sub-Committee on Pollution Prevention
and Response (PPR), proposing that additional
controls be put in place to reduce the quantities
of high viscosity and persistent floating substances
discharged to the environment.
One of the areas earmarked for further
consideration is pre-wash requirements, with
the suggestion made that all products defined as
‘persistent floaters’ should be required to perform
some form of pre-wash.
It has further been suggested that the definition
of ‘high viscosity’ in MARPOL Annex II should be
changed from ‘50mPa at discharge temperature’
to ‘50 mPa at 20ºC’. The most far-reaching effect
of this would be to curtail the current practice
of heating certain vegetable oils to take them
out of the high viscosity range and thus avoid
carrying out a pre-wash. In fact most, if not all,
vegetable oils and animal fats would be captured
As concern grows over substances such as vegetable oils and waxes
washing up on coastlines, European countries are calling for tighter
o ific tion to r les on the h n lin o ships resi es
net tro e o the ntern tion l rcel n ers ssoci tion writes
under one or both of these measures. before returning to backload.
Since there are also more than 100 other Since unloading and backloading at the same
products in the International Code for the port is a fundamental feature of the worldwide
Construction and Equipment of Ships Carrying parcel tanker trade, this could have a profound
Dangerous Chemicals in Bulk (IBC Code) defined effect on the industry.
as ‘persistent floaters’, to follow this route would
require a serious commitment on the part of IMO Tightened regulations look likely
member states and terminals in their ports to
provide reception facilities to deal with the vast No formal proposals have yet been made in respect
increase in residues being delivered ashore. of any of the above ideas, and IMO procedures mean
Another suggestion concerns the definition that a formal proposal would have to be made to
of ‘en route’ in MARPOL Annex II in relation to the Marine Environment Protection Committee
the discharge of residues. The current definition: (MEPC) before discussions can begin in earnest
‘underway at sea on a course or courses, including in the Evaluation of Safety and Pollution Hazards
deviation from the shortest direct route, which ... (ESPH) Group. Given the current programme of
will cause any discharge to be spread over as great meetings of the MEPC, it is unlikely that the issue
an area of the sea as is reasonable and practicable’ will be formally considered before the PPR Sub-
is understood by most member states to include a Committee in spring 2016.
ship going out to sea to tank clean before returning It nevertheless seems clear that, sooner or
to the same port to backload. later, we are going to see yet another review of
There have been suggestions, however, that this MARPOL Annex II and tightening of the regulations
practice should be outlawed, with ‘en route’ being concerning the handling of residues of a wide
redefined to make it clear that it involves going variety of products. !
to a different port. This would mean that where a Janet Strode is general manager at the International
vessel was discharging and back loading at the same Parcel Tankers Association. This article originally
port it would either have to deliver its entire tank appeared in the March 2014 FOSFA newsletter. For
washing residues ashore or proceed to another port more information, visit www.fosfa.org

26 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

IMO discharge rules.indd 1 22/10/2014 11:50


T Soyabean glut creates uncertainty
he global oils and fats market looks set
to be “flooded with soyabeans”, with
an extra 35-37M tonnes of production
expected in the 2014/15 season,
bringing the crop to some 311M tonnes,
Thomas Mielke, editor-in-chief of Oil World told
the Globoil conference in Mumbai, India on 27-28
September.
The glut would result in a surplus in soya meal
supply, with crushers and traders needing to find a
market for the meal, leading to a fall in prices.
The extra soyabeans may not help meet growing
world demand for edible oils, as it was unclear at
what pace soya would be crushed to release the oil if
meals prices were low, “so you could see insufficient
supply in several markets”, Mielke added.
Other oilseed production for 2014/15 was
expected to fall by 4.1M tonnes (against an increase
of 13.2M tonnes in 2013/14) and crushing was
also expected to fall one million tonnes (against an
increase of 9.4M tonnes in 2013/14).
Mielke said the growth in the oils and fats market
would be below normal at 4-5M tonnes for 2014/15,
less than half the increase of the 10.7M tonnes seen
in 2013/14.
Against that, total consumption of oils and fats
grew 8M tonnes in the last 12 months to some
200M tonnes. “We do not expect this to continue
because we will not have enough oil supply.”
Mielke said the glut of soyabean production was
also a big uncertainty for India. Various speakers
forecast that the soyabean crop would grow by 10-
12% to reach 10.5M-12.5M tonnes in India, creating
the same uncertainty over the timing of crushings.
27 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Globoil 1/2.indd 1
IN DIA
Plentiful supplies of soyabeans on the global and Indian market will
create uncertainties over the timing of crushing this season and
subsequent availability of soyabean oil, the Globoil conference heard
in India recently. Serena Lim writes
India’s high dependence on imports edible oil from 5% to 10%, and from 10% to 25% on
refined oils.
Dinesh Shahra, managing director of Ruchi Soya Angshu Mallick, chief operating officer of India’s
Industries, said India was forecast to consume Adani Wilmar, said India’s edible oil market was huge
20M tonnes of edible oils next season, of which 7M and unorganised. Of the 18M tonnes of edible oils
tonnes would be met with domestic production. consumed every year, 50% was in the “unorganised”
India would need to import 13M tonnes of edible sector. Only 31% of urban households used branded
oils to meet the shortfall in demand, comprising 9M oils, compared with 9% of rural markets.
tonnes of palm oil, 2M tonnes of soyabean oil and “It is a cluttered market. Currently, there are
2M tonnes of sunflowerseed and canola oil. more than 2,000 brands reported monthly by
Vijay Data, president of the Solvent Extractors Nielsen India in the cooking oil category.”
Association of India (SEA), said India urgently Mallick said India’s growing middle class
needed to address its high dependence on imported population meant an increasing potential consumer
edible oils, with the SEA putting an action plan to base.
the government to increase productivity of oilseeds, “In 1985, the share of middle-income class in the
introduce GM crops and increase planting of oil total population was 1%. In 2010, it was 13% and is
palm as a plantation crop. projected to rise to 20% in 2015 and 37% in 2025,
Edible oil prices were at an historic low since rising at a CAGR rate of 8.5% from 2010 to 2025.
2008 and there was also an urgent need to “This offers huge market potential. The market
protect the country’s farmers from cheap imports, value is estimated to increase by 122% in the next
particularly from Indonesia and Malaysia. He urged four years from some 470M INR to 1,100M INR in
the government to increase the import tax on crude 2018, growing at an annual rate of 25%.” !
23/10/2014 14:23

Supercharged safflower
trition ll he lth s owersee oil is therin interest ro the
oo io el n oleoche ic l in stries e to its hi h level o
oleic ci s n ilit to row in ost re ions o the worl
h rlotte ie iec writes
A
s a crop that shows some potential
as a biofuel feedstock, safflower
remains a surprisingly neglected crop
in comparison to the oil giants of
palm, soyabean and rapeseed. World
production is around 600,000 tonnes/year, with
the majority grown in India (41%, on around
300,000ha).
Saffloweroilcontainsmanyhealthyproperties,
but it does not nearly approach the popularity
of sunflower oil, to which
it is nutritionally similar. The
safflower plant grows up to 150cm
tall with globular flower heads that
have yellow, orange or red flowers.
It resembles a thistle and each
branch has one
to five flower
RESEMBLING SUNFLOWERSEED AND OIL, SAFFLOWER IS BEING EYED AS A
28 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Safflower.indd 1
OILSEEDS
heads containing 15 to 20 seeds/head. It is an
ancient crop, with evidence of its use dating back
to the 12th century – dyes made from safflower
were identified in the tomb of Tutankhamen. Its
colourings have been used for making red and
yellow dyes, which were known as carthamine
in the 19th century. According
to safflowerseedoil.org, the plant
has enjoyed a rich history in
both the east and the west and
could be described
as “one item
that bridges the
commercialisation of
agriculture
WINTER ROTATION CROP FOR BIOFUEL.
(PHOTO: ANDREY SHUPILO/DREAMSTIME.COM)
from ancient times to modern day.”
Safflower seeds produce both monounsaturated
oil and polyunsaturated oil, the former commonly
used as a cooking oil and the latter as a cold oil, for
example, mixed into salad dressings. Both contain
Vitamin E, Vitamin K and omega-3 fatty acids.
Recently, agricultural biotechnology company
Arcadia Bioscience Inc launched its Sonova Ultra
GLA safflower oil. The oil has 55% gamma linoleic
acid (GLA) at twice the concentration produced in
any other oilseed, the company says. To put that
into perspective, evening primrose oil contains
approximately 10% GLA and borage oil contains
around 20%. GLA is an omega-6 fatty acid that
is claimed to provide dietary support in weight
management and, in combination with the omega-6
fatty acids EPA and DHA, can support heart and eye
health and reduce inflammation, asthma, diabetic
neuropathy and rheumatoid arthritis.
Aside from its edible oil uses, safflower seeds,
which are rich in methionine, are useful as an
ingredient in formulated poultry feed.
India the key producer
Regardless of its relatively small world production,
safflower is grown in around 60 countries, including
India – which produces almost half the world total
– followed by the USA, where California state leads.
According to a January 2011 Business Line
article, while India is ranked number one in
safflower production, it has some of the poorest
productivity levels, with low yields of an average
630kg/ha compared to the global average of
893kg/ha. Other producing countries include
the USA (17%), Argentina (13%) and Kazakhstan
(12%). China leads in productivity, reaching an
average yield of 2,519kg/ha, followed by the USA at
1,639kg/ha, Argentina, 897kg/ha and Kazakhstan,
750kg/ha.
The article further notes that safflower occupies
seventh place in the area dedicated to oilseeds
in India, and 99% of it is grown in the southern
plateau region (see Table 1, pg 30). The states of
Maharashtra and Karnataka contribute 55% and
31%, respectively, but Gujarat has the highest
productivity (1,000kg/ha), followed by Karnataka
(795kg/ha), Maharashtra (565kg/ha) and Andhra
Pradesh (462kg/ha).
Headed for the highway
In 2010, the US Army turned its attention towards
safflower in Utah, where it grew wild on 20 acres of
government land, according to a Salt Lake Tribune
article. Noting the potential, officials decided to
cultivate the land and harvest the crop, capable
of producing 50 gallons/acre of biofuel. While 20
acres was initially selected to trial the scheme, the
crop is expected to be planted on the entire 200
acre property.
Utah State University (USU) – a key player in
the scheme – is pursuing a “FreeWays to Fuel”
programme that aims to plant oilseed crops such
23/10/2014 11:13

as safflower, canola and flaxseed along the often
unused roadsides in the USA. USU researchers
suggested that the nation could produce around
one billion gallons/year of biodiesel by harvesting
along highways.
Safflower has also been selected as an ideal
winter crop for Texas. One study, conducted at the
Department of Agriculture and Applied Economics,
Texas Tech University, Texas, USA, concluded that
winter safflower would be a profitable feedstock
for biodiesel production in that state. The study
noted: “With a positive net economic value (NEV)
of 99,886 BTU/gallon and net energy ratio (NER)
of significantly greater than one, the safflower-
derived biodiesel system yields more useful energy
out than is required during production, processing
and transport.”
On-location biofuel in Afghanistan?
Interest in safflower has been growing throughout
the world. In a June 2010 paper titled “Producing
and using biodiesel in Afghanistan”, authors Wayne
Arden and John Fox suggest the US military
grows the crop in Afghanistan and builds biodiesel
refineries to produce biofuel for use in their vehicles.
Arden and Fox explain that, as importing fuel
into the country is an expensive business, producing
biodiesel ‘on location’ would make solid financial
sense, provide the country with an additional crop
and source of income, and perhaps even lessen its
production and trade of opium.
This out-of-the-box thinking demonstrates the
versatility of safflower, which is “best suited as
Afghanistan’s first biodiesel crop. It is native to the
Safflower.indd 2
OILSEEDS
region and, although not a major crop, safflower
is already cultivated in Afghanistan. Safflower has
a long tap root and is highly drought-resistant. If
more safflower is planted than is needed to supply
the first biodiesel plant, the oil could be sold to
consumers – safflower oil is one of the healthiest
vegetable oils for human consumption (Afghanistan
currently imports most of its vegetable oil).
Safflower oil’s cold weather properties approach
those of petroleum diesel. For subsequent biodiesel
plants, crops such as camelina and pennycress
should be considered; these crops are not, however,
currently grown in Afghanistan.”
Cost savings to the US military were estimated
at US$3.7bn in the first year and US$3.8bn in
subsequent years, with the cost of an estimated
US$90M to build the plant itself.
Australia leading safflower research
A group of researchers and scientists at Australia’s
Commonwealth Scientific & Industrial Research
Organisation (CSIRO), the country’s national
science agency, are working towards the
commercialisation of industrial chemicals derived
from safflower.
The researchers are attempting to ‘supercharge’
safflower to produce increased amounts of fatty
acids. Deputy chief of CSIRO Plant Industry,
Dr Allen Green, spoke to Glen Paul about the
possibilities and why the team chose safflower as its
platform.
“It was a consultation with the growers
themselves. The Grains Research & Development
Corporation (GRDC) surveyed and worked out
29 OFI – OCTOBER/NOVEMBER 2014
what would be best as an additional crop for
farmers in Australia, and safflower works very well
in the northern parts ... Also, because it has a very
small production for food, we think we’ll be able to
segregate it quite easily for the food and industrial
types in production and handling.”
He explained that the team were using CSIRO’s
gene silencing technology (RNAi technology) to
switch off the conversion of a desirable fatty acid,
oleic acid, which is very valuable for industrial
products, and switch off its conversion to the
polyunsaturates, which are good for food, but not
good for industrial products.
Dr Green explained that safflower could have a
significant impact on lessening our dependence on
fossil fuel petrochemicals as a biomaterial. Using
safflower has the additional advantage of producing
greater energy than that put into producing the
crop.
Green notes that “we will need to grow and
produce more product per unit area of all our crops
in the future, as demand for food and industrial
products goes up, so the challenge is to get more
productive and get more value out of our cropping
systems.”
Oleic acid is an important oleochemical platform
that can be used in a range of industrial applications,
such as high-stability lubricants, dielectric fluids
(electrical insulators) in power transformers, and
as raw materials for bio-based polymers (plastics).
“It’s interesting that the high oleic oil that we
produce could be suitable for food, but in our food
oils we need to have a balance of fatty acids for
nutrition, so high oleic oils have been developed
overseas but they’ve generally been up to 80%, so !
23/10/2014 11:13
Untitled-1 1 10/22/14 11:22 AM
 OILSEED S

" that you still get the nutritional fatty acids in those

PHOTO: RAPTORCAPTOR/FOTOLIA.COM
oils. It’s completely different for industrial uses –
you want as high a purity as possible, so really to
push this up to 93%, potentially to 95% of one
particular compound is a very big advantage for
“Safflower oil is
industrial use. We wouldn’t think that that oil would
be used in food production, although it would be
perfectly safe for human consumption.”
He added: “It’s still a number of years before
one item that bridges
the commercialisation
we get this to market. Obviously, we’ve made this
breakthrough and we now have to develop varieties
and commercialise those, so it’s probably five or
six years down the track before farmers can get
involved. But we’re interested in this particular
product because we thought it had potential for
about 100,000ha of additional production for
of agriculture from
Australian farmers, so it’s a sizeable new crop
benefit, and that’s why the GRDC was interested
as well. And they see that, in the long-term, these
industrial products will also have premium prices,
ancient times to
compared to traditional crops, so there’s an
opportunity for added value for the growers.”
In January this year, the Office of the Gene
modern day”
Technology Regulator (OGTR) approved the team’s
application to establish field plots of experimental
safflower lines. If the outcomes are positive, OIL PRODUCED FROM SAFFLOWERSEEDS IS FLAVOURLESS AND COLOURLESS AND NUTRITIONALLY SIMILAR TO SUNFLOWER OIL
the group would work toward making
commercial varieties available by 2018. “It’ll be TABLE 1: SHARE OF SAFFLOWER TO TOTAL OILSEEDS AREA AND PRODUCTION IN INDIA
a GM crop, even though it doesn’t have any new Year Total oilseeds* Total oilseeds* Safflower % total Safflower % total
transgenes, it has only its own DNA replaced.” – Area Production Area Production
Finally, Green notes, the GRDC is looking into 1990-93 25.1 19.1 2.7 1.5
safflower improvement in anticipation that the crop 1995-98 26.2 22.8 2.6 1.4
will be bigger in the future. !
Charlotte Niemiec is OFI’s assistant editor Source: Kalpana Sastry et al, 2001 * 3-year average

31 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Safflower.indd 3 23/10/2014 11:13

 BIOFU ELS

The route forward PHOTO: SKYPIXEL/DREAMSTIME.COM

genetically optimised for ethanol production. The

There are three main routes forward for biofuels, given the slow feedstock mix for biodiesel production has shifted
development of second-generation commercial production: an toward corn oil and waste greases, which have lower
rated carbon intensities.
incremental route, a transitional route and a leapfrog route. This The second route is the transitional route,
feature is extracted from a paper published by the NextSTEPS in which “firms gain experience with cellulosic
Research Consortium of the Institute of Transportation Studies feedstocks while using existing infrastructure
and supply chain logistics to the largest extent

B
iofuels present great promise but also
great challenges, according to a paper
published by the NextSTEPS Research
Consortium (NextSTEPS) of the
Institute of Transportation Studies at
UC Davis, titled ‘Three Routes Forward for Biofuels:
Incremental, Transitional and Leapfrog’.
Enthusiasm was high in 2006 when President
George W Bush promoted biofuels in his State of
the Union speech to enhance energy independence
and reduce greenhouse gases (GHG). Achieving
those goals seemed straightforward: boost corn
ethanol, then transition to non-food (cellulosic or
algal) materials. This plan received strong support
from the agricultural industry, energy security
advocates and farm belt communities. Some
environmentalists expressed concerns but, overall,
optimism was high.
Scepticism slowly spread in the following years.
Corn ethanol production was energy-intensive,
consumed large amounts of land, likely raised food
prices and indirectly increased GHG emissions by
diverting land to corn production. With increasing
quantities of US corn production being diverted
to ethanol production, reaching 40% in 2009,
the debate over the magnitude of these impacts
among stakeholder groups and researchers soon
spilled over into the mass media and Congress.
Scepticism was even stronger in Europe, aggravated
by increasing use of fuels made from vegetable oils,
especially involving palm oil linked to deforestation
of rainforests in Southeast Asia.
When the US Congress codified the Bush goals
into law in 2007 in the Renewable Fuel Standard
(RFS), it established a mandate of 15bn gallons of
corn ethanol by 2015. This was accompanied by a
delayed but rapidly expanding target for cellulosic
fuels, reaching 16bn gallons/year by 2022, plus
an additional one billion gallons for biodiesel from
algae, waste oils and oilseed crops.
Corn ethanol was expected to create the
conditions for cellulosic (and algal) biofuels to
leapfrog forward – providing even greater energy
and GHG benefits. However, the jump from
demonstration to commercial stage has so far
proven difficult for cellulosic (and algal) biofuel
companies. In 2013, the production of starch and
oil crop-based fuels topped 14bn gallons. Fewer
than one million gallons of cellulosic biofuels were
produced in 2013, while the mandated level had
been set at one billion gallons. To date, even smaller
volumes of algae-based fuels have been produced.
Given the slow development of commercial-scale
cellulosic and algal biofuels, the NextSTEPS paper
examines the future of biofuels by characterising
three distinct routes forward.
The options
The first is the incremental route, in which “progress
happens at existing biorefineries by improving
the existing production system”. There has been
considerable innovation at existing biorefineries
that produce corn ethanol and biodiesel. Most
notable are new technology processes to extract
corn oil from the ethanol co-product stream for sale
as biodiesel and animal feed – now integrated into
about 80% of US corn ethanol plants.
Additionally, some biorefineries are switching
their plant’s process fuel to lower-carbon sources
(for example, from natural gas to landfill gas),
while others are lowering the energy use of their
plant by switching from dry to wet distiller grains
co-production.
Still others are improving the starch-to-ethanol
yield through the use of corn strains that are
possible”.
A number of other biofuel technologies are
emerging that facilitate a transition to large-scale
cellulosic production. “Bolt-on” systems refer to
equipment added onto existing biorefineries that
allow for the processing of cellulosic material
alongside corn or sugarcane sugar streams; bolt-
ons are either physically bolted on to the existing
system or added as adjoining facilities that share
some infrastructure with the existing system.
Currently, three types of feedstocks are being
tested in bolt-ons:
! Corn kernel fibre (a physical bolt-on that shares
most corn ethanol plant facilities
! Bagasse (already processed at sugarcane ethanol
plants to produce electricity, but requires some
additional process vessels for ethanol conversion
! Corn stover (like bagasse, except not as yet
collected and brought to a central location).
Bolt-ons are transitional in that they generate
additional demand to help establish larger markets
for the enzymes needed to break down cellulosic
material, while also giving fuel producers experience
using the enzymes as well as the cellulosic material,
including the logistics of collecting and preparing
the feedstock for conversion.
Some efforts also are helping increase the
general knowledge base for handling and converting
cellulosic biomass. In addition, biochemical firms
have also begun converting cellulosics to industrial
chemicals, thus helping to establish enzyme
markets. Finally, other companies are also boosting
the knowledge base about cellulose material,
turning it into intermediates use for heat and
electricity.
The third and final route is the leapfrog route, in
which “cellulosic and algae investments to produce
ethanol or drop-in gasoline or diesel replacement

32 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Biodiesel.indd 1 22/10/2014 10:04

 B I OF UE L S

fuels are made at new, stand-alone biorefineries”.

Currently, about 50 firms are pursuing commercial-scale cellulosic and
algae plants in the USA. These associated facilities are at various stages
of development, including at least six with partially or fully completed
commercial-scale plants.
However, output from the completed plants typically remains far below
plant capacities due to financial and technical problems. As the next
biorefineries come online this year (for example, POET and Abengoa), as Purity Rules
well as others in Europe, the industry will have a better picture of the current
viability of commercial-scale cellulosic and algae biofuel.

Financial considerations
These biofuel routes lay the foundation for an in-depth analysis of the
tradeoffs between different investment and policy strategies – in terms of
carbon emissions reductions and level of investment risk.
Relative to the transitional or leapfrog route, incremental improvements
typically have lower financial risk, shorter payback periods, lower capital
requirements and higher probabilities of successful implementation.
Therefore, as US biofuel policies have become increasingly stringent, these
improvements appear to be the “lowest hanging fruit” for producers. However,
the incremental route is likely limited in its GHG reduction potential, both
by the thermodynamic potential of existing biorefineries and the fact that
TIME.COM expanded use of conventional biofuel feedstocks includes the risk of higher
emissions from land use change.
On the opposite end of the risk spectrum is the leapfrog route. Leapfrog
technologies are expected to have low carbon intensities compared to corn
ethanol, due to the high yields of dedicated energy crops, as long as they are
grown on land not under pressure for other use.
Leapfrog technologies also can unlock important resources – such as
organic fractions of municipal waste – that have no land use risk and few
alternative uses. However, leapfrog technologies may remain costly and
challenging to move to maturity – with costs dropping slowly from the first
plant to the ‘nth’ plant – and may be seen to waste public money if relatively
few new technology advancements and benefits are achieved on a year-by-year
basis. Since 2009, funding from venture capitalists, federal programmes and
oil companies has averaged US$1.8bn/year. The NextSTEPS model suggests
that, in a world with low-to-moderate gasoline prices, leapfrog technologies
might never reach cost parity with petroleum fuels. Leapfrog technologies
could also have additional environmental costs, such as those related to land
competition.
Between the incremental and leapfrog routes lie transitional technologies,
typically “bolt-on” units. The NextSTEPS research says that bolt-ons could
increase ethanol yield/acre of corn by five percent for corn fibre and up to
30% for stover. Therefore, the transitional route is limited in its maximum
potential GHG benefit, as corn acreage in the USA is not expected to greatly
expand in the future and would cause greater land-use impacts if it did.
Ensuring that agricultural residue is sustainably harvested (enough left
in place to meet production needs) also limits supply. If every corn ethanol
plant in the USA added fibre and stover bolt-ons, this route will offer
approximately 3.5bn additional gallons of cellulosic biofuel. However, its
much bigger benefit could lie in aiding a transition to large-scale cellulosic
biofuel production. Edible oil refining with separators from
The NextSTEPS paper estimates that the incremental route has the GEA Westfalia Separator Group: flexible,
potential to result in biorefineries with lifecycle GHG emissions about
reliable and highly efficient…
30% lower than existing conventional plants, or transitional and leapfrog
biorefineries with 20% and 80% lower emissions than gasoline, respectively. simply pure quality.
The study suggests that a strongly implemented incremental route could
improve the GHG ratings performance of a far larger biofuel production
volume in the next 10 to 15 years than the transitional or leapfrog routes.
This leads to greater potential GHG benefits in early years, but gains flatten
out as, eventually, nearly all incremental biofuels are fully improved. In
contrast, with steady growth, potential aggregate GHG reductions associated
GEA Westfalia Separator Group GmbH
with an aggressive leapfrog route could surpass the incremental route by Werner-Habig-Straße 1, 59302 Oelde, Germany
2025 and eventually be much larger.
Phone: +49 2522 77-0, Fax: +49 2522 77-1794
Incremental developments ws.info@gea.com, www.gea.com

Incremental developments made to existing biorefineries aim to incrementally

lower energy use and cost, and potentially emissions as well. Examples
include improvements made to feedstock harvest and transportation, GEA Mechanical Equipment
feedstock loading, conversion efficiency and distribution at corn ethanol !
engineering for a better world
RR-02-002

33 OFI www.oilsandfatsinternational.com

Biodiesel.indd 2 22/10/2014 10:04


" or soya biodiesel plants. According to the Air
Resources Board (ARB)’s website, the industry has
seen a large-scale movement towards more efficient
and lower carbon-intensive plants in the USA and
Brazil. In total, the biorefineries that have applied
for new or modified pathways in California’s Low
Carbon Fuel Standard (LCFS) programme produce
approximately 5.5bn gallons/year of fuel, not all of
which ends up in California.
While reductions in carbon emissions need to
be independently vetted – and displacement effects
analysed – the advantages of this route are that
(1) the existing fuel supply is large (over 14.5bn
gallons in 2013) and, therefore, the potential
carbon reductions are also large and (2) these
improvements often add value to a producer beyond
carbon reductions.
Leapfrog developments
The leapfrog category includes cellulosic and algae-
based biofuels produced at stand-alone plants.
Because these technologies are not proven at
scale, there is a chance the fuels will continue to
be much more expensive than conventional routes
or that they will fail to live up to the promised
environmental performance.
Additionally, the approach entails a large risk
of failed investment, as clearly demonstrated
by multitudes of start-ups in the past decade
(the paper counts at least 22 bankrupt firms and
dozens of firms that have pivoted out of cellulosic
biofuels). The US federal government is the
largest single supporter of the leapfrog route and
invests through: small-business loans, biorefinery
grants, Advanced Research Projects Agency-Energy
(ARPA-E) grants, US Department of Agriculture
(USDA) feedstock improvement grants, and
the Department of Defense advanced biofuel
programme. Private equity funds are also active
funders of the leapfrog approach and tend to focus
on small, start-up leapfrog firms.
A third source of funding for the leapfrog approach
is from large, capital-intensive corporations like oil
companies or chemical manufacturers. Firms such
as Shell, British Petroleum and DuPont have the
advantage of deep pockets to disperse the risk of
failed investments and global operations to utilise
low-cost feedstocks and labour markets. They
also tend to be technically sophisticated with a
strong understanding about liquid fuel conversion
processes and complex, global supply chains.
However, for the corporate leapfrog funders,
biofuels offer a much lower profit margin than
the products that fall in their core expertise (for
example, gasoline) and several have scaled back
biofuel investment in the last three years.
The NextSTEPS paper identified 66 firms
worldwide that have built, are building or plan to
build cellulosic or algae biorefineries. Of these, 53
were based in the USA. Other leapfrog firms have
stayed alive simply through continuous fundraising
or through switching to higher value, non-energy
bioproducts. Of the various conversion technologies,
biochemical conversion using enzymatic hydrolysis
and fermentation is the preferred technology of the
greatest number of firms.
Transitional technologies
Technologies that utilise small quantities of
cellulosic material are potentially a bridge to
34 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Biodiesel.indd 3
BIOFU ELS
ETHANOL PRODUCED FROM CORN IS A POPULAR CHOICE
FOR COMMERCIAL FACILITIES
the leapfrog route. These technologies give
producers much-needed expertise with handling
and converting cellulosics, and potentially help
establish market connections for cellulosic
feedstocks. Three examples of products from
transitional technologies are: ethanol from bolt-on
plants (including additions within, or adjacent to,
existing plants), industrial chemicals and pyrolysis
used in petroleum refining.
Bolt-ons are typically smaller scale and have a
lower investment risk than stand-alone cellulosic
and algal biorefineries. These plants benefit from
shared supply-chains, distribution networks and
capital costs, with shared or adjacent conventional
biorefineries.
Currently, three types of bolt-on facilities are
under development: corn fibre, sugarcane bagasse
and corn stover. Bolt-ons using corn fibre have the
smallest investment risk because the additional
equipment is small compared to the conventional
plant. Edeniq and ICM claim their corn fibre
conversion technologies increase yield by three to
five percent above conventional corn ethanol.
Bolt-on facilities that use bagasse are also being
developed. They require larger processing units,
fewer shared facilities and higher investment risk
than corn fibre conversion, but benefit from the
fact that bagasse is already collected and stored
at sugarcane plants. Thus, unlike for corn stover, a
new collection process is not needed. Bagasse bolt-
on units are expected to increase yield by as much
as 25%.
For bolt-on plants, the largest investment risk is
corn stover. The POET-DSM plant in Emmetsburg,
Iowa, which opened this summer, has a separate
corn stover biorefinery adjacent to the existing corn
ethanol plant. The plant is considered a bolt-on
because it shares entry roads and grid connections
as well as ethanol processing. The NextSTEPS paper
estimates that stover processing can increase yields
at corn ethanol plants by 30%.
Several other firms could reasonably be placed
as working within transitional technologies. Some
firms, such as Midori Renewables, Vertimass LLC,
ICM, Edeniq, Gevo, BP, Inbicon and DuPont,
develop and license bolt-on technology to existing
biorefineries.
Others are developing conversion technologies
that might lower costs in the future. Ensyn and
Talko Industries are building a fast pyrolysis plant in
Alberta, Canada, which will be used to power Talko’s
sawmill. Ensyn has another project with an oil
company in which they are blending small amounts
of pyrolysis oil from cellulose in crude oil prior to
refining into petroleum products, thereby lowering
the carbon intensity of the petroleum production.
Conclusions
If all three routes were pursued in an aggressive
fashion, the study estimates a modest decline
in transportation GHG emissions by 2030
relative to today’s level. (This calculation relies
on controversial carbon intensity values and
accounting used in today’s policies).
Several other biofuel GHG reduction strategies
are also being pursued around the world, such
as bolt-on facilities in Brazil utilising sugarcane
bagasse and various renewable and biodiesel
facilities utilising non-food crops (for example,
jatropha) and algae.
In the near-term, the study sees incremental
improvements at existing corn ethanol and soya
biodiesel plants or similar facilities using other
feedstocks offering the greatest carbon reduction
potential.
However, if the goal is to achieve large GHG
reductions from biofuels (for example, greater
than 20%), then leapfrog technologies appear very
likely to be needed. Cultivating them at the scale
required under conditions that do not erode their
low-carbon status, especially given other demands
on biomass, is a pressing challenge for the future.
An incremental technologies strategy is
especially attractive, given the slow development
and commercialisation of leapfrog technology
and the unpredictable current and future policy
landscape. Precisely how far process improvements
can go in terms of lowering carbon intensity at a
relatively low cost is uncertain, and remains an
empirical question.
The transitional technologies are attractive
because of their potential to facilitate learning and
development for future cellulosic biofuel production
at a far lower investment and risk level than full-
scale leapfrog investments. But, ultimately, leapfrog
technologies should be attractive to any policy
maker serious about deep GHG reductions in the
transportation sector.
However, the paper concludes, if a long-term goal
is to expand the share of biofuels in aviation, marine
transport and heavy duty vehicles, then drop-in
biofuel pathways will be needed.
The transitional innovations and most of the
current leapfrog innovations do not involve the use
of drop-ins. From an energy planning perspective,
the NextSTEPS paper recommends greater specific
policy focus be placed on developing drop-in
biofuels. !
This feature is extracted from the NextSTEPS
Research Consortium of the Institute of
Transportation Studies at UC Davis’ report titled
‘Three Routes Forward for Biofuels: Incremental,
Transitional and Leapfrog’ and has been used with
kind permission.
22/10/2014 10:04
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 I NSPE CT ION , TESTIN G & C ER TIFIC ATION
Inspection and testing round-up
Oils & Fats International reports
on some of the latest news
and developments surrounding
inspection testin n certific tion
around the world
SGS expands globally
S GS has made a series of expansions across the
globe. SGS Indonesia announced in July the
opening of a new agricultural laboratory, located
in Banarmasin, South Kalimantan, Indonesia. It is
an analyst member of the Federation of Oils, Seeds
and Fats Association (FOSFA).
After the success of a similar lab in Medan,
North Sumatra, SGS has expanded its existing line
of services for the palm oil business to serve an
increased demand for testing.
Indonesia, the world’s largest producer of palm
oil, has seen demand for the product for both food
and non-food use increase rapidly over the last 20
years.
The new laboratory in Banjarmasin is located 15
minutes from Syamsuddin Noor airport and seven
hours from Tarjun.
The company said the facility’s convenient
location woud drastically reduce turnaround times
and would help preserve the quality of samples, due
to shortened shipping times.
As international trade in seed grows, so does the
requirement for timely and effective seed testing
and analysis services. To meet increased demand in
one of the world’s major markets, SGS has launched
a new seed testing laboratory in China.
The new facility provides extensive laboratory
testing and research services, delivering analysis
and evaluation of seed quality, optimisation and
improvement.
The company provides a series of genetically
modified (GM) tests based on DNA and polyamerase
chain reaction (PCR), and can identify the presence
of GM organisms in concentrations as low as 0.01%.
For non-transgenic seeds, it provides testing for
the detection of specific GM organisms to avoid
transgenic security issues.
It conducts standard label testing, which is
mandatory testing of items according to the four
seed labelling regulations of China’s seed law,
including seed germination testing, analysis of
clarity, variety identification, purity testing and
moisture testing, among others.
The company also performs TZ testing, a
three-step test for viability. This service examines
preconditioning, preparation and staining, and
evaluation.
In Argentina, SGS’s contract research services
have developed a new field trial facility in Junin
city, the country’s main crop region. A new team,
equipped with the latest technologies, will conduct
efficiency trials, good laboratory practice (GLP)
studies and GM regulated trials.
36 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Inspection and Testing.indd 1
IFFO opens certification for non-members
PHOTO: IFFO
T he International Fishmeal and Fish Oil Organisation (IFFO) has decided to allow non-
members of the organisation to apply for certification under its Global Standard for
Responsible Supply (RS), in order to continue the standard’s growth as recognised best
practice for fish oil and meal production, Lipid Technology reported in June. In addition, it will
add a second certification body to its programme to give more choice and availability, and a
number of new clauses relating to factory management have also been proposed. These can
be viewed on the organisation’s website at www.iffo.net.
Andrew Jackson, chairman of IFFO RS Board, said: “The IFFO RS standard has got off to
an excellent start, but the board felt that the time had come to widen the ambition of the
standard to address the whole global marine ingredients industry. The decision to allow non-
IFFO members to apply for the standard gives the factories processing the over 40% of global
production not coming from IFFO members the opportunity to demonstrate their responsible
practices.”
Elaborating, he said: “These practices will now include not only responsible raw material
procurement and safe processing, but also some entry-level requirements in the areas of
factory effluent and emissions, as well as employee terms and conditions. These changes
should reassure the marine ingredients value chain that products certified to our standard are
being responsibly produced and are increasingly available for their use.”
EU lifts restrictions on MBP Group receives
Ukrainian sunflower oil RSB certification
T he European Union (EU) endorsed measures
in July to lift import restrictions on sunflower
oil from Ukraine that have been in place since
B y-product collection company MBP Group has
achieved the Roundtable on Sustainable Bio-
materials (RSB) sustainability certification for its
2008. waste material collection, trading and distribution
A specific certification scheme was applied activities, the company announced in August.
following the discovery that a number of David Magnussen, CEO, said: “MBP Group
consignments of sunflower oil from Ukraine were was built on a sustainable background, adding as
contaminated with mineral paraffin. Since tests much value as possible to industrial by-products.
carried out at EU borders have revealed no further Sustainability was – and still remains – a key
contamination, the systematic testing regime has ingredient of our business activities and its success.
been gradually relaxed. We are pleased to see that our company was certified
In 2009, the 100% testing of imports was replaced according to the RSB scheme; this constitutes an
with random sampling, while systematic testing of important recognition of our continuous efforts for
exports before they left Ukraine was maintained. the sustainable management and trade of industrial
The Standing Committee of EU Member waste and by-products.” The company provides
States experts agreed to measures lifting the services to a wide range of industries and specialises
testing regime, which will apply 20 days following in finding optimal markets for bio-derived fats and
publication at the EU Official Journal. oil, as well as solids and powders. !
22/10/2014 09:40
Project1_Layout 1 5/28/14 10:41 AM Page 1
 I NSPE CTION , TESTIN G & C ER TIFIC ATION
! Edible oil adulteration
up to 64% in India
I n July, the Consumer Guidance Society of India
(CGSI), a city-based NGO, claimed at a press con-
ference on loose edible oil adulteration that almost
64% of the loose edible oil in India was being mixed
with palm oil, DNAIndia reports. Sesame seed oil,
coconut oil, groundnut oil, mustard oil, sunflower
oil, cottonseed oil and soyabean oil was found to be
affected.
Dr Sitaram Dixit, chairman of CGSI and Dr
M S Kamath, secretary, CGSI said their team
had collected as many as 269 samples that had
been sent for testing. Of the collected samples,
almost 64% tested positive for adulteration with
inexpensive palm olein.
Kamath said: “Luckily, there were no dangerous
substances found in the samples, but the majority
of the oil samples contained cheap palm olein.
We want the state government to withdraw the
government resolution that it passed in 2013 to
allow the sale of loose oil.” He added that CGSI had
raised the issue with the Food and Drug Association.
A report from the Deccan Chronicle further
reported that packets of Sun Gold refined oil, Best
Heart refined sunflower oil and Everyday Gold
refined sunflower oil were found to be deficient in
volume, and that the Legal Metrology department
had booked seven cases against retailers of edible
oil in Hyderabad.
“After getting information from the public that
traders of Sarda Oil Mills and BRS Refineries were
engaging in short-filling of edible oils sachets and
tins, we conducted a raid on the edible oil units.
During our inspection, we found that volumes were
less by 15ml in one litre sachets, and 134ml in 15kg
tins and 5kg tins.
“Seven cases were booked for violation of
the Legal Metrology Act 2009 and Packaged
Commodity Rules 2011. Goods worth Rs 20,51,860
(US$33,681) were seized,” the news outlet
reported S Gopal Reddy, ADGP and controller of
Legal Metrology, as saying.
Inspectorate Agri
expands across Canada
I Alex Stewart to offer
nspectorate Agri, a core part of the Bureau Veri-
tas Commodities Division, announced in a 16
June press release that it had acquired an ISO/
IEC 17025:2005 accredited grain analytical labora-
tory in Saskatoon, Saskatchewan, Canada, which
specialises in grain inspection and testing, includ-
ing grain grading, mycotoxin analysis (vomitoxin,
ochratoxin, aflatoxin and zearalenone), protein and
moisture estimation, falling number analysis and
insect infestation detection.
The company has also opened two new labs in
Canada, one in Weyburn, Saskatchewan and one
in North Vancouver, British Colombia, the press
release said.
Both facilities have similar capacities to the
Saskatoon facility for testing and grain inspection.
Services include on-site grading and inspection
vessel loading and inspection, quality and quantity
certification for vessels, and rail car sampling and
! inspection.
38 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com
Inspection and Testing.indd 2
Coconut insecticide endangers certification
P roducers of virgin coconut oil (VCO) in
the Philippines have expressed concern
that the insecticide used to kill the coconut
scale insect (CSI) (aspidiotus rigidus) is likely
to affect their certification as suppliers of
organic produce, Business World reported in
July.
The family of insecticides called
neocotinoids is injected via the trunk of the
coconut tree and could cause the chemicals
to seep into coconut products such as VCO,
they said. According to a statement sent out
by the United Coconut Association of the
Philippines (UCAP), “organic certification”
requires no chemicals, no chemical
pesticides and no inorganic fertilisers”.
Without certification, importing countries
cannot sell these products as “organic” or
“natural”.
The Philippine Coconut Authority (PCA) has
said that it is “endorsing both chemical and
Certified coconut oil Palm oil benchmark
launched in Philippines NGO-backed Palm Oil Innovation Group (POIG)
has set up a new benchmark for palm oil with
A programme to develop a certified coconut oil
supply chain to enhance sustainability and im-
prove the livelihoods of 2,500 coconut growers in
the Philippines has been launched, the Indian Coco-
nut Journal reported in May. The programme is the
result of a partnership between industry giants the
Deutsche Gesellschaft für Internationale Zusam-
menarbeit (GIZ) GmbH, BASF and Cargill. The
partnership is co-financed by the German Federal
Ministry for Economic Cooperation and Develop-
ment (BMZ) through its programme ‘develoPPP.de’.
The programme focuses on smallholder coconut
growers in the southern Philippine island of
Mindanao and aims to raise farmers’ income by
improving productivity and coconut oil quality.
It will also introduce the Sustainable Agricultural
Network (SAN) standards as a basis for Rainforest
Alliance Certification for coconut production.
Farmers will be provided with newly designed
coconut dryers to improve the quality of copra
(coconut meat) and coconut oil.
organic protocols” in combating the insect,
and said that chemical treatments have
“scientific basis”.
“We are not insisting on relying only on
the use of chemicals. PCA is promoting both
chemical and organic solutions. Studies and
experiment(s) show that the use of both
chemical and organic pesticides complement
each other, with the chemical pesticide
having a 30-day active effect on eradicating
the CSI and the organic pesticide being able
to flush out the remaining CSI on surfaces
of fronds.”
According to the PCA, an organic solution
is also available for spraying on the infested
trees, saying that “the product is 100%
organic-based and biodegradable as it is
made from edible plant sources”.
This had been effective in trees in the
Calabarzon region, where the CSI infestation
was most serious, the report said.
a view to taking responsible palm oil sourcing to a
new level, Community reported in July. The group,
established by NGOs including Greenpeace and the
WWF – as well palm oil producers – has published a
set of indicators that allow independent verification
that palm producers are meeting the strict guide-
lines set out by the POIG charter.
The charter builds on the Roundtable for
Sustainable Palm Oil (RSPO)’s certification
standard, with additional requirements that ensure
all palm oil operations are free from deforestation,
the destruction of peatlands, and human and labour
rights abuses.
POIG added that the new benchmark standard
was good news for the growing list of palm oil
consumer companies, including Nestlé, Ferrero,
Unilever, L’Oreal, Safeway, DelHaize, Procter
& Gamble, General Mills, Kellogg and Mars,
which have made ‘No Deforestation’ commitments
and are demanding responsibly produced palm oil.
inspection in Uruguay
A lex Stewart International Corporation, which
provides inspection for foodstuffs and agricul-
tural commodities, among others, announced in
January it was now able to provide full inspection
services for metals, minerals and soft agricultural
commodities from Uruguay, South America.
Coverage would include all ports of loading,
discharge, refineries, warehouses and points
of logistical importance for quantity and
quality certification, and for the import and
export of commodities in Uruguay. In addition,
Uruguayan inspection operators would support
and complement the company’s inspections
infrastructure throughout South America, in
particular Argentina and Brazil. "
22/10/2014 09:40
p39_Sharplex_Oxford_Mahle_feature.qxp 10/22/14 11:44 AM Page 20

39 OFI www.oilsandfatsinternational.com
 STATISTIC S

SUNFLOWER OIL VS RAPESEED OIL PRICES (US$/TONNE) STATISTICAL NEWS FROM MINTEC

Sunflower and rapeseed oils

Prices for both sunflower and rapeseed oils continued
to fall year-on-year (YOY), reaching a four-year low in
September due to the good availability of sunflower
oil and rapeseed oil, as well as other vegetable oils.
Global rapeseed oil production is forecast at a record
26.2M tonnes, up one percent YOY. Global sunflower
oil production is forecast at 15.4M tonnes, down one
percent on the 2013/14 record production.

GROUNDNUT OIL PRICES AND PRODUCTION (‘000 TONNES)
Groundnut oil
Groundnut oil prices followed a similar trend to 2013,
falling sharply in the first quarter of the year and
rising steadily in Q2. Global groundnut oil production
in 2014/15 is forecast at a record 5.7M tonnes, an
increase of two percent YOY. Groundnut production is
expected to rise in India and China, providing weather
conditions remain favourable. However, US groundnut
production is expected to fall by seven percent from
last season’s crop, which resulted in a steady increase
in prices between May and August.

Biodiesel and diesel

EU biodiesel prices have fallen since the start of
BIODIESEL PRICE (US$/TONNE) 2014 as a record European rapeseed harvest and
high US stocks of soyabeans lowered the cost of
biofuel feedstocks. The European harvest of rapeseed
was estimated in August to reach 22.7M tonnes
in 2014/15, up 1.3M tonnes from the previous
month’s forecast and up seven percent YOY. Soyabean
production in the USA is also expected to reach a
record 103.8M tonnes, up 16% YOY. As a result, ending
stocks of soyabeans in the USA are forecast to increase
significantly, to 11.8M tonnes in 2014/15, up from
3.8M tonnes in 2013/14.

Mintec is the principal

PRICES OF SELECTED OILS (US$/TONNE) independent source of global
information for commodities
2012 2013 May 14 Jun 14 July 14 Aug 14 and raw materials. We
specialise in helping
Soyabean 1,230 1,052 968 931 889 850 supply chain professionals minimise risk. We provide
Crude Palm 1,014 854 888 858 828 746 services that range from detailed market reporting and
Palm Olein 997 803 816 789 762 697
consultancy projects to packages of sophisticated tools
Coconut 1,122 948 1,410 1,378 1,237 1,173
for analysing and interpreting market information. Mintec
Rapeseed 1,240 1,080 948 919 875 853
Sunflower 1,256 1,108 945 931 899 837
supports leading suppliers, processors, retailers, service
Palm Kernel 1,119 904 1,256 1,224 1,098 943 providers and major end-users across a wide range of
industrial and consumer goods sectors with statistical
information and expert market analysis.
Average price 1,140 964 1,033 1,004 941 871 Tel: +44 (0) 1628 851313; E-mail: sales@mintec.ltd.uk
INDEX 270 228 245 238 223 206 Website: www.mintecglobal.com

40 OFI – OCTOBER/NOVEMBER 2014 www.oilsandfatsinternational.com

Statistics.indd 1 20/10/2014 16:51

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