B10 biodiesel deferred as palm oil prices strengthen

Once again, the palm oil lobby’s mission to sell more palm oil as bio-diesel has been rebuffed. This time, the postponing of the B10 biodiesel has been directly attributed to the increasing price differential between palm oil and mineral diesel.

This deferment, the third one over the last half year, was announced by the Minister of Plantation Industries and Commodities (MPIC) on Tuesday. No longer hot news, the statement was treated as a minor five paragraph story tucked well past the prime news pages. Familiarity breeds contempt?

"We have decided to defer it (implementation of B10 for transport fuel and B7 for industrial fuel) until a more suitable time when the gap between oil and palm oil price is not so big,” the Minister, Datuk Seri Mah Siew Keong, told a press conference on Tuesday.

There are two things to take home from this latest postponement:

1. It should be recognized that palm oil is not going to be cheaper than oil from the ground anytime soon. That being the case and if the government's price pragmatism is consistent, then the transport sector shouldn't have to be worried about the implementation of B10 biodiesel until the biofuel complies with the technical standards of engine makers.
2. Faced with the opposition of car makers to using a fuel of unverified specification, the Ministry should push the Malaysian Palm Oil Board (MPOB) to get on with an international-standard of research and development of B10 biodiesel so that this formulation (10 per cent palm methyl ester to 90 per cent of mineral oil) is technically inscribed by car makers.

Finally, professional transport fuel users have decided to make known their opposition to B10 biodiesel until the fuel is proven to the satisfaction of engine makers.

The Association of Malaysian Hauliers and the Pan Malaysia Lorry Owners Association have jointly called a press conference for next Thursday (November 24).

AMH executive secretary, Mohd Hanif Abdul Ghani, told carbay.my that the press conference was to make known the transport sectors concern over the use of a B10 biodiesel fuel that could diminish the longevity of their truck engines.

"We haven’t voiced our concern yet. We decided to hold a joint press conference because this deferment of B10 biodiesel is only temporary. The government will bring it back again and we want to stop this until we’re sure that B10 biodiesel won’t invalidate the guarantees of our truck makers,” he said.

That’s a wise and timely move because just as the boy who cried “Wolf”, there’s going to be one day when the government announces B10 implementation and the transport industry is blindsided.

It’s time that more affected parties voice out their concerns about the pre-mature implementation of B10 biodiesel.