Brazil to import palm oil to meet biodiesel mandate
Brazil plans to step up its purchase of palm oil from Malaysia in order to meet a government mandate for a 2 %
biodiesel (B2) content in diesel starting Jan. 1, 2008.
To comply with the mandate, Brazilian refiners must blend some 800,000 tons of biodiesel into 38 mm tons of diesel fuel by yearend.
But Brazil currently is producing less than 300,000 tpy of soya oil-based biodiesel, a shortfall of 500,000 tons,
said Eduardo Pessoa de Carvalho, chief executive officer of Brazil's Meridian Trading.
Because Malaysian palm oil's price is lower, Brazil likely will buy more of it as feedstock to blend with its soya oil-based biodiesel, Carvalho said.
In 2006, Brazil bought 33,222 tons of Malaysian palm oil, more than twice the 14,620 tons purchased in 2005.