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Maize surplus boost for biofuel
CAPE TOWN - The government was prepared to reconsider the exclusion of maize in the production of biofuels, Grain SA, the maize farmer organisation, said last week.|
* "Local demand is about 9 million tons and when local production exceeds that it puts downward pressure on the maize price, hitting the long-term confidence of the industry" |
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Kobus Laubscher, Grain SA general manager
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The organisation said it had held a "very positive" meeting with agriculture and land affairs minister Lulama Xingwana in mid-December about reviewing the exclusion of maize as a biofuel feedstock.
Lobbyists pushing for the reversal of the exclusion say the move would have benefits for the economy, as it would boost maize production and increase the use of under- used land.
In the announcement of its biofuels industrial strategy early last month, the department of minerals and energy excluded maize as a biofuel feedstock, citing concerns that the inclusion of the crop would compromise food security and inflate already high maize prices.
Grain SA general manager Kobus Laubscher told Business Report that since this announcement Xingwana had invited Grain SA to a meeting where she had expressed a willingness to review the matter.
Xingwana had said she would like to gather more information, and Grain SA had agreed to assist in this regard said Laubscher.
Xingwana could not be reached for comment, but it is believed the talks included a consideration that in years of surplus maize production the excess could be made available for biofuel production. However, an unreliable annual maize supply may not be enough to tempt maize biofuel projects such as Ethanol Africa to invest in a plant.
Laubscher has criticised the exclusion of maize as a feedstock for putting a ceiling on maize production. "Local demand is about 9 million tons and when local production exceeds that it puts downward pressure on the maize price, hitting the long-term confidence of the industry."He added that at present maize was not only for human consumption, but that a significant amount was used as an animal feedstock.
White maize is generally used for human consumption while yellow maize is fed to livestock.
The government's decision to exclude maize and include other crops in its biofuel strategy has given impetus to at least three large refinery projects that are at relatively advanced stages of planning.
The first project is a joint venture between petrochemical group Sasol, the state-owned Central Energy Fund (CEF) and black economic empowerment partner Siyanda Biodiesel, to produce 100 million litres of biodiesel a year from soya beans at Newcastle, Sasolburg or Secunda.
The other two projects, separate joint ventures between the CEF and the Industrial Development Corporation, will yield 200 million litres of bioethanol from sugar cane in Mpumalanga, and from sugar beet in the Eastern Cape.
Several proposed biofuel projects have been on ice pending release of the long-awaited strategy. In December minerals and energy minister Buyelwa Sonjica outlined its key features, although the document has yet to be released.
She also chopped biofuel production targets from 4.5 percent of the country's fuel pool to a conservative 2 percent.
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