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Bioenergy no 4 july 2015

SPOTLIGHT Bioenergy Int International No 80, 4-2015 17 2015, including at least 180 000 tonnes of pellets and 130 000 tonnes of palm kernel shells (PKS) a residue from the palm oil industry. – Most of the projects under construction or in planning expect to get their biomass from domestic sources. Many projects may not be able to realise this objective. They should either switch fuel, close down, or not start, or they have to look outside Japan, commented Matt Bovelander, Analyst with consultancy company Indufor Asia Pacific Ltd. According to Bovelander the market for imported biomass still relatively small with supply currently dominated by pellets from Canada along with palm kernel shells (PKS) from Indonesia and Malaysia. Buyer prices are still high and influenced by the cost of supply/quality, longevity, and quantity trade-off. – Japanese utilities are well positioned and well disposed to seek substantial volumes of quality biomass, secured over long term supply contracts. The FIT supports the Japanese price paying capability. Generally they can afford to pay prices at USD 200-220 per tonne of pellet equivalent CIF, suggested Bovelander. Taking the trading house perspective Tomoyuki Itabashi from Itochu Corporation spoke on filling the gap between biomass producer and utility enduser. – User demands and suppler demands often does not meet each other. We, as an investor in biomass power plants and supplier of biomass fuel, are fully aware of the demand on both sides. Relying on a single supply source is too risky, relying on a single country is too risky. We organize multiple supply chain to end-user, said Itabashi adding that Itochu assumes responsibility for the biomass fuel supply chain throughout the entire 20-year FIT period even a supplier goes out of business. Tightning Korean standards Malaysian biomass pellet producers have been ramping up production targeting the Korean utilities. – The Korean RPS gave us big potentials in the past years. Many Malaysian SMEs have invested into biomass business. However, 30 percent of pellets producers are struggling right now because their products cannot meet the Korean standard and they don’t know how to find buyers. The FOB price drops to 100 USD/t. Korean power companies emphasis on shortterm supply contracts and focus on price. Thus, we look into Japan biomass power market and wish to influence Japan’s policy. Japan biomass power demand can consume the total pellets production from SEA countries, said Dato’ Joseph Lim Heng Ee, CEO, Global Green Synergy Sdn. Bhd. Text & photos: Xinyi Shen Illustrations courtesy Indufor/CMT BI80/4854/AS – The potential of Japanese wood resources is enormous. But it seems only a few million m³ are being provided, said Miyuki Tomari, Biomass Industrial Society Network. – Japanese utilities are well-positioned, explained Matt Boveland, Indufor Asia Pacific.


Bioenergy no 4 july 2015
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