By Madelaine B. Miraflor
The Philippine Coconut Authority (PCA) wants the National Biofuels Board (NBB) to finally raise the Coco Methyl Ester (CME) content of biodiesel currently sold in the domestic market starting August, a move that has been stalled for several years.
To recall, it was in 2012 when the Department of Energy (DOE) said it is looking to review the impact of a possible increase in the biodiesel blend to five percent — also known as B5 — as requested by the Department of Agriculture (DA).
Then in 2015, NBB — which is composed of representatives from the DOE, DA, PCA, Department of Agrarian Reform, Department of Science and Technology, Department of Environment and Natural Resources, and Sugar Regulatory Administration — has tapped an institution within the University of the Philippines Los Baños (UPLB) to study the impact of B5 implementation.
All of this, in order to help millions of coconut farmer is currently suffering from low copra prices.
Under the Philippine Energy Plan 2012 to 2030, the DOE targets to increase the biodiesel blend to 5 percent from the current 2 percent. The blend should increase by 10 percent and 20 percent in 2020 and 2030, respectively.
But right now, PCA Administrator Romulo J. de la Rosa is already urging NBB to "act fast" before copra and CNO prices further plummet to crisis level, suggesting a staggered basis increase starting August.
“The first increase can be from two percent to three percent starting August 1 this year,” he said. “This means that the biodiesel blend to be sold in the domestic market should have three percent CME and 97 percent regular diesel starting August 1.
Dela Rosa then pushed the NBB to decide before December, 2018 whether to further increase the blend to five percent CME content or maintain the three percent until 2020.
“The coconut industry needs policy action now,” he added.
According to him, the increase could effectively support our coconut farmers and farmworkers whose livelihoods are threatened by the declining prices of crude coconut oil (CNO) in the international market.
The price of CNO has declined by over 40 percent in the last few months because of a glut in supply in the world market of vegetable oils.
As of last week, CNO was selling at its 16-month low of US$ 1,100 per ton from a high of US$ 1,850 per ton.
To date, Philippine biodiesel has the lowest percentage of vegetable oil blended to regular diesel among ASEAN countries.
Malaysia and Thailand mandate that the biodiesel sold in their markets should contain at least seven percent palm oil. Indonesia’s is much higher, at 20 percent.
The recommended August 1 deadline to increase the biodiesel CME content to three percent gives oil industry players ample time to procure their CME supplies and reset their blending ratios, PCA said.
“The higher CME content in our biodiesel could significantly increase the demand for copra and CNO, making their prices more buoyant,” De la Rosa said.