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THE
continuous implementation of the country’s biofuels
program as mandated by the Biofuels Act of 2006 is a
bold step toward the government’s vision of reducing the
country’s dependence on imported fuel.
“It
[implementation of biofuels program] is a bold step
toward the right direction,” Merritt Partners, an energy
consultancy company, said in a report.
Merritt,
which is chaired by former energy secretary Vincent
Perez, said the issues should be examined based on the
actual agricultural situation of a particular biofuel-producing
country.
In the
Philippines Merritt noted that biofuel substitute for
diesel is primarily sourced from coconut, while that for
gasoline is expected to be taken from sugar cane.
Merritt
emphasized that the Philippines is currently among the
top producers and exporters of sugar cane and coconut,
respectively, in the world.
Citing
records from the Bureau of Agriculture Statistic, the
country’s staple food such as rice, according to
Merritt, has seen an increase in production between 2002
and 2007 from 12.39 million tons (MT) to 16.24 MT, and
from 4.04 million hectares to 4.27 million hectares in
terms of land area.
“These
figures have led us to conclude that the implementation
of the biofuels program had not affected the country’s
food production,” Merritt said.
Merritt
noted that rising food prices can be attributed to
speculative trading, increase in demand from growing
economies, changes in weather patterns, and incessant
increases in fuel costs.
Merritt
said, as an archipelago, the price of commodities in the
country is susceptible to fuel spikes as economic-
production areas are scattered in a number of islands,
and the unabated rise of oil prices does not bode well
for an oil-importing country like the Philippines.
“It is
clear that the country needs to develop and utilize
indigenous- fuel sources to support and sustain its
growth and counteract the consequences of high oil
prices,” Merritt said.
The
Asian Institute of Petroleum Studies Inc. (Aipsi) and US
National Biofuels Board (USNBB) have earlier said that
biofuels have limited impact on food supply and pricing
in the Philippines.
Aipsi
and USNBB issued the statement in response to the United
Kingdom’s Gallagher Review of biofuels that expressed
concern that biofuels may raise food prices.
“While
the Gallagher Review is specific to the United Kingdom’s
own renewable-fuels policies, it is fair to note that
the research done by US experts and the US Department of
Agriculture has proven that biofuels-related feedstock
demand has limited impact on global food supply and
pricing,” Joe Jobe, USNBB chief executive officer, said.
He
noted, though, that with gas prices soaring to more than
$4 a gallon, the addition of biofuels to the US fuel
supply is one of the only things keeping prices from
going higher.
Raffy
Diaz, Aipsi managing director, further said that to say
it has none (no impact) is naďvete.
“But to
pass on nearly the whole problem of food supply and
price as being the result of biofuel to the level of
more than 75 percent of feedstock production is outright
ridiculous,” he added.
Diaz
said the claimed impact of biofuel feedstock eating up
on food supply is very much below 10 percent on global
basis, which pertains to corn for ethanol and soybean
for biodiesel.
“A
situation in one country cannot be echoed as being true,
globally. But we do know that there are antibiofuel
forces [and I believe we know who they are] who will
jump and bankroll every opportunity to make mountain out
of tiny molehill of issue on biofuel,” Diaz said.
He said
the country’s biodiesel requirement at 1-percent
biodiesel blend is around 60 million to 70 million
liters annually because demand for diesel is between 6
billion and 7 billion liters (and this is fast
declining due to high fuel cost).
For B2,
biodiesel requirement will be double to around 112
million to 114 million liters by 2009.
“From
coco-oil production of 1.4 billion liters per year more
or less, the biodiesel component will translate to just
4 percent to 5 percent for B1 and 8 percent to 10
percent for B2,” Diaz said.
He added
that “the coco methyl ester requirement for B1 and
eventually B2 is less than 10 percent of total
coconut-oil production so it would be obvious that the
steep rise in coco-oil price cannot be totally
attributed to biodiesel.”
Diaz
said the cocobiodiesel initiative, which was given
serious focus at the turn of the new millennium, was
meant to raise copra price at farmgate level to
alleviate poverty in the coco industry.
Diaz
said, however, the steep rise in the price level of
copra and/or coconut oil today cannot be attributed
anymore to the local CME demand.
“Coconut
oil has many uses as health food, as
surfactant/detergent, as specialty lubes, as fuel
additive component, as ingredient for skin care and
cosmetics, and many others,” Diaz said. |
