Report discusses Australian biofuel industry

By Erin Voegele | August 22, 2016

A recent report filed with the USDA Foreign Agricultural Service’s Global Agricultural Information Network provides updated data on Australia’s biofuel industry, noting ethanol production is expected to reach 250 million liters (66.04 million gallons) this year.

The report explains Australia’s biofuel industry is relatively small and has faced significant challenges in recent years. Production of ethanol is relatively stable, supported by a 6 percent mandate in New South Wales and a 3 percent mandate that is set to go into effect next year in Queensland.

According to the report, Manildra is the largest producer of ethanol in Australia with a capacity of 300 million liters. The company primarily uses waste wheat as feedstock. Two smaller producers located in Queensland take in sorghum and sugar as feedstock and have respective capacities of approximately 80 million liters per year and 60 million liters per year. Together, the three plants have a nameplate capacity of 440 million liters per year.

Locally produced ethanol comprised approximately 1 percent of the total road transport fuel market in Australia last year. E10 was the prominent blend, with ethanol primarily sold in New South Wales and Queensland. According to the report, ethanol use has been declining in recent years due to the lower availability of E10 and consumer preference for regular unleaded. In addition, the lack of a significant price difference between regular gas and E10 is cited as a contributing to the decline.

Australia also currently has a small biodiesel industry, with approximately 50 million liters produced last year. According to the report, biodiesel output has declined significantly due to a surge in imports. A new excise arrangement is now making biodiesel imports fully subject to prevailing excise on diesel and the industry is described as restructuring.

The report also addresses second-generation biofuels, including those manufactured from energy crops and algae, noting that while these fuels have been successfully demonstrated, they are not yet commercially viable in Australia.

A full copy of the report can be downloaded from the USDA FAS GAIN website.