5% Biodiesel Blend Pushed Amid Declining Copra Price

Representatives of coconut farmers, coconut oil producers and the business sector are urging government to immediately implement the Biofuels Act of 2006 mandating all diesel fuels sold in the domestic market to be blended with coconut methyl ester (CME). They said increasing the CME blending ratio from the present 2 percent (B2) to 5 percent (B5) can help address the plummeting copra prices which affect the livelihood of 3.5 million coconut farmers and the entire sector.

A resolution initiated by the Philippine Coconut Authority (PCA) justifies that increasing the blend to B5  as mandated by the law will raise local crude coconut oil utilization and in turn stabilize domestic copra prices.  PCA Administrator Romulo de la Rosa, quoting industry experts, said the increase in demand for coconut oil with the implementation of B5 could push copra prices to the range of P30 per kilo that will translate to about P22 per kilo at farmgate. He pointed out the current price of P13 in remote areas is below the breakeven copra production price of P15 per kilo.

Quoting a study by the Asian Institute of Petroleum Studies Inc., PCA said the biofuels industry would need at least 360 million liters of CME per year and some 490 million kilos of copra if it were to implement the B5.  De la Rosa said production of B5 can also help the country save on foreign exchange because of forgone diesel import.