Biofuel feedstock prices set to remain high

14 March 2008 16:52  [Source: ICIS news]

BRUSSELS (ICIS news)--Biofuel feedstock prices will remain high for the next one to two years while vegetable oil and cereal demand continues to grow, said First Capitol risk manager Will Babler on Friday.

 

“Global demand has grown a lot faster than global supply,” said Babler, speaking at the World Biofuels Markets conference here as part of a discussion on global biofuel pricing

 

“This will not change overnight and global prices will probably stay high for the foreseeable future,” he added.

 

World cereal and vegetable oil prices have soared over the past year due to the combination of poor crop yields and increasing demand from growing economies such as India and China, Babler said.

 

Frontier Agriculture Limited’s industrial crops director Richard Whitlock agreed that high prices had been caused by low stocks.

 

“Farmers’ reaction to these high prices has been to capitalise by producing more. With this in mind prices should ease in two years' time,” he said.

 

The three-day conference ends today.

 

For more on biofuels see Simon Robinson's Big Biofuels Blog

By: Lucy Craymer
+44 20 8652 3214

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