By Kent Swisher
Vice President, International Programs, National Renderers Association
Global biodiesel production continues to grow dramatically with current production estimates at around 1.1 billion gallons. The International Energy Agency predicts production of biodiesel to reach close to 6.3 billion gallons by 2020 and this estimate appears to be low. Of course, the greatest growth in biodiesel production has been in the European Union and the United States, respectively. However, there are other large consumers of energy looking towards the promise of biodiesel as a renewable fuel.
China is the second largest consumer of crude oil behind the United States. By 2020, China’s oil consumption is predicted to grow by roughly 77 percent as compared to 2005 consumption. This would total a consumption of over 13.5 trillion gallons.(1) Fueling this demand is the dramatic surge in automobile ownership in China, with an average growth rate of 11.8 percent between 1986 and 2004. Beijing authorities report 1,000 new cars are added to the roads each day.(2)
This growing demand for fuel, along with pollution concerns that come with it, has led China to focus more efforts to promote the production of environmentally friendly renewable fuels. Over the last 20 years, most of the government’s biofuel policy efforts have been aimed at ethanol promotion. It was not until 2006 that the government began creating serious policies to promote biodiesel production. Production of ethanol in China in 2005 totaled 258 million gallons and is predicted to increase to 1.1 billion gallons by 2010. In comparison, biodiesel production was only around 42 million gallons in 2005 and is predicted to reach 600 million gallons by 2010.(2) The diesel market in China is two times that of the gasoline market, so there is a much greater opportunity for longer term expansion in biodiesel production.
Prior to 2004, there were only three biodiesel producers in China. However, by 2005, there was estimated to be over 100.(3) The original biodiesel producers mostly relied upon used cooking oil and animal-based raw material. However, as the industry develops and government research funds are becoming available, more vegetable sources are being considered, such as rapeseed oil, soybean oil, Jatropha curcas, and Chinese pistachio. Also being increasingly considered and used is imported palm oil. There have been many reports in the media of joint ventures being signed between Malaysian palm oil interests and companies in China to build palm oil-based biodiesel facilities in China. Both Malaysia and Indonesia, who, combined, produce over 90 percent of the world’s palm oil, are aggressively pursuing increasing the use of palm oil for biodiesel production. In fact, Malaysia’s goal is to use 40 percent of its palm oil production in biodiesel.
The key long-term constraint to biodiesel production in China is the lack of raw material. Currently, domestically, there is approximately 600 million gallons of recycled frying oils that can and are being used in biodiesel production.(3) The government has allocated funds to research and find vegetative plants that can be produced domestically to meet the demand for raw material. However, China has very little arable land and the land that is arable is much needed to produce food for its populace. This problem brings up the food versus fuel debate. Due to China’s enormous population, and limited arable land, it is greatly deficient in oils and fats and really has no choice but to expect to import raw material to meet the increasing demand of its fledgling biodiesel industry.
In contrast to China’s deficiency, North America produces a large surplus of animal fats and greases. The National Renderers Association continues to promote its products for biodiesel usage through the efforts of its office in Hong Kong under Regional Director Dr. Yu Yu. In the future, the North American rendering industry hopes to be a part of this exciting boom in biodiesel production in China.
References
1. “China’s crude oil supply, demand and import in 2020.” March 23, 2005. Alexander’s Gas and Oil Connections, News and Trends: E & SE Asia. 10:6.
2. “China, People’s Republic of, Bio-Fuels, An Alternative Future for Agriculture.” 2006. U.S. Department of Agriculture, Foreign Agriculture Service GAIN Report.
3. Liu, Yingling. “Used Cooking Oil Promises to Fuel China’s Rapidly Expanding Car Fleet.” October 12, 2006. China Watch.
International Report - February 2007 Render