Report: Australia’s biofuel consumption to remain minimal in 2020

By Erin Voegele | September 29, 2020

The production and consumption of liquid biofuels in Australia is expected to remain minimal in 2020, according to a report recently filed with the USDA Foreign Agricultural Service’s Global Agricultural Information Network.

The report predicts ethanol is expected to account for only 1.4 percent of the gasoline pool in Australia this year, stable with the blend level in 2019. Biodiesel consumption is also expected to remain stable, accounting for only 0.2 percent of Australia’s total diesel pool.

Although Australia is almost entirely reliant on imported fuels and has robust supplies of feedstock for both ethanol and biodiesel production, only a small amount of those crops is used to produce renewable fuels. The report cites a lack of federal subsidies, tax credits and mandates as a primary reason for low biofuel production and use. Although two Australian states do have biofuel mandates, those goals are far from being reached.

According to the report, no new ethanol plants have been built in Australia over the past decade, and there has been no increase in production capacity. While the country’s biodiesel industry experienced some initial progress several years ago, multiple facilities closed in the mid-2010s. Imports of biodiesel were also curtailed. As a result, Australia's average national blend rates collapsed. 

The report cites the Australian government as reporting that it is already on track to meet its greenhouse gas (GHG) emissions reduction commitments by 2030. As a result, no changes to federal or state policy are expected to result in increased biofuel production or use in the near or medium terms.

Only three ethanol plants with a combined 440 million liters (116.24 million gallons) of annual capacity were in existence in Australia last year, a number that has held steady for a decade and is expected to be maintained through 2020. Those plants are expected to operate at 53.4 percent capacity this year, down from 56.1 percent in 2019. Australian ethanol production is expected to reach 235 million liters this year, down from 247 million liters in 2019. Consumption is expected to be at 220 million liters this year, down from 239 million liters last year.

Wheat is currently the top ethanol feedstock used in Australia, followed by Molasses, sorghum and barley.

Australia’s average national blend rate for ethanol is expected to be at 1.4 percent this year, flat with 2018 and 2019.

Australia is also currently home to three biodiesel plants with a combined 107 MMly of nameplate capacity, flat with 2019. The country’s biodiesel capacity peaked in 2013 when Australia was home to seven biodiesel plants with a combined 312 MMly of capacity.

Australia’s biodiesel plants are expected to operate at 39.3 percent of capacity this year, up from 26.2 percent in 2019. Biodiesel production is expected at 42 million liters in 2020, up from 28 million liters in 2019. Consumption is expected at 26 million liters this year, flat with 2019. The national average blend rate is expected to be at 0.2 percent this year, flat with 2019. The blend rate peaked at 3.8 percent in 2014.

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



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