PotashCorp sees biofuels as demand driver in 2007

21 February 2007 17:03  [Source: ICIS news]

TORONTO (ICIS news)--The global biofuels boom is driving demand for grain, wheat, soybean and other crops, translating into higher fertilizer demand in 2007 and beyond, the chief executive of Potash Corporation of Saskatchewan (PotashCorp) said on Wednesday.

 

The biofuels growth is accelerating already high crop demand for food production from the growing economies of China and India, Bill Doyle told an investor conference in New York.

 

The European Union is expected to raise the percentage of biofuels used in vehicles from 1.40% to 5.75% by 2010, Doyle said. Much of Europe’s biofuels need will be met by Malaysia and Indonesia, he added.

 

Canada and the Philippines are also looking at 5% blending targets. India has mandated 5% by 2012 and 10% by 2017.

 

Even Brazil, with its long history in using ethanol in gasoline, is looking to boost its target further, to 25%, from 23%, Doyle said.

 

“The world will again this year face a significant gap between what is produced and what is consumed [in terms of crops],” Doyle said.

 

As a result, demand for potash fertilizer should rise by 10% this year, with strong demand growth in all regions, Doyle said.

 

But despite rising demand, PotashCorp would not invest in a greenfield potash mining project, Doyle said.

 

The company believes it will be able to meet demand by debottlenecking and expanding its existing mines, he said.

By: Stefan Baumgarten
+1 713 525 2653

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