Business & Financial News

Necessity of oil, coal and gas replacement by biofuel becomes more and more urgent. “Biofuel” means the hi-tech products received from agricultural crops or waste of processing of vegetative and animal raw material which almost do not pollute an atmosphere.
However, in experts’ opinion, these hopes will not come true. The idea of manufacture of cheap fuel, which stocks will be practically inexhaustible, seems too ideal to be the truth. Already now manufacturers of biological fuel have collided with huge quantity of problems.
One of them relies in sharp rise in prices on agricultural production. This tendency, in turn, has led to occurrence of fears concerning the future shortage of food stuffs in connection with fast increasing population. LMC International Ltd experts have come to conclusion that for adding of about 5 % of an impurity of biological fuel into car (as it was supposed - till 2015), about 100 hectares of the agricultural grounds (about half of area of Indonesia) are required. However, these are just those areas, which are now basically accessible (including the remote regions of Brazil and Africa).
Unstable economic situation in the countries - manufacturers of biofuel is one more reason on which “the green dream” is practically impracticable. The prices for oil have grown on 40 %, but palm oil which always was rather inexpensive, has jumped up on 2/3. Now its cost makes nearby 735 doll./ton, and it is clear that it is much cheaper to use oil (nearby 593 doll./ton). Even in the USA, where the government finances this sector, incomes of the factories making biofuel, decrease because of too high prices for raw material and too low prices for ethanol (on which manufacture of the USA take in the lead positions). In Southeast Asia, which has always been one of the main manufacturers of palm oil, the majority of biofuel projects have been also postponed because of very small profits.