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Feedstock Options for Biodiesel Production. Jon Slee Marketing Manager Riverland Oilseed Processors. Outline. Main sources – Animal & Vegetable What drives prices S & D World & Australia Summary. Tallow Fancy White Edible K Grade (NZ Tallow) Yellow Grease Recycled Fat.
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Feedstock Options for Biodiesel Production Jon Slee Marketing Manager Riverland Oilseed Processors
Outline • Main sources – Animal & Vegetable • What drives prices • S & D World & Australia • Summary
Tallow Fancy White Edible K Grade (NZ Tallow) Yellow Grease Recycled Fat Canola/Rapeseed Soybean Oil Palm Oil Palm Olein Palm Sterein Sunflower Groundnut Main sources – Animal & Vegetable
What drives prices: • World oil/fat supply & demand (stock to use ratio) • Substitution (Lowest cost oil Vs Intrinsic Use) • Feed Energy Costs (Floor price fat Vs Grain) • Logistics (Freight rates, shipping delays etc) • World move to “Just In Time” (JIT) • Politics – Import tariffs/duties • Biosecurity – BSE, Non GM Markets • Biodiesel & Biomas
The bottom line: • Import Parity Vs Export Parity • Increase demand domestically for feedstock and the price will increase to an import parity level. • Eg Rapeseed Oil Price 5yrs ago in EU was US$20 premium to Sth American Soy today it is trading at US$200 premium.
CBOT Soyoil Price (Monthly) US Cents per lb Eg 25 cents * 22.0462 = US$551.16
A$ Vs US$ Soyoil @ US$551 / 80cent = A$688 Soyoil @ US$551 / 50cent = A$1102
International Oil Price Snap Shot: US$ Per metric Tonne Prices as per Oilworld Estimates
Summary: • Multiple Feedstocks available (opportunity cost) • Export Vs Import parity Price • Currency Can Play a major role • Large Variation in regional supply • Think about the long term and look global