Malaysia can become major biodiesel exporter

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PETALING JAYA: Malaysia has the capacity to be a major palm biodiesel exporter alongside supplying to the local market, said Platinum Energy Sdn Bhd CEO Edward Leung. Leung said Malaysia, being the world’s second largest palm oil producer, had good potential to supply more biofuels to Europe, US and other regions as palm-based biodiesel was cheaper than the rapeseed and soy feedstock used in Europe. The China market would also be a key opportunity as it would eventually have to start importing biofuels to meet its local diesel demands, Leung said yesterday at a press briefing here. He added China did not have sufficient feed to drive its biofuel industry given that it mainly used cooking oil to produce biodiesel and its manufacturers were located in clusters. “Malaysia also has substantial edge over Indonesia, our nearest competitor in palm oil, as we have a larger installed capacity to produce biodiesel of between one million and 1.5 million tonnes,” Leung told The Edge Financial Daily. Based on Malaysian Palm Oil Board (MPOB) statistics, Malaysia exported 182,108 tonnes of palm biodiesel, a vast increase from the 95,013 tonnes exported in 2007. At the same briefing, Asia Bioenergy Bhd executive director Looi Kem Loong said many local biodiesel manufacturers were exploring cheaper feed alternatives such as oil extraction from algae and palm oil fatty acids distilling (PFAD), as palm based biodiesel were largely dependent on the fluctuating prices of crude oil and crude palm oil (CPO). Biofuel lost attractiveness during the last year when CPO prices peaked, forcing many biodiesel plants out of operation in early 2008, said Looi. He added many biodiesel plant operators had started planting its own feedstock to secure supply and manage costs amidst uncertain fluctuations of crude palm oil. While fluctuating prices had been a major challenge, Looi said the Malaysian biodiesel industry had taken a “positive swing” this year with government vehicles set to use B5, a mix of 95% regular diesel and 5% methyl ester which is derived from palm oil, from February.