Impressions on Conference Style in Asia and Challenges Facing the Biofuel Industry in Asia
by Stefaniya Becking (Advanced Biofuels USA) The “Sugar & Ethanol Asia 2013” conference organized by F.O. Licht took place in Bangkok, Thailand, on February 26-27, 2013. This event attracted 125 people representing 20 countries (mostly private sector in Asian countries). The focus of presentations stayed on worldwide trends and the economic status of the sugar ethanol industry.
As this conference was the first Asian conference I had an opportunity to attend, it was interesting to note the differences in social interactions and the content of the discussions as compared to biofuel conferences I participated in the United States (US) and Europe.
In general, the idea of attending conferences does not seem to spark as much interest in Asian countries as people prefer to rely on their existing professional network. People who attended the conference for the most part held back from asking questions when it came to panel discussions, but were eager to ask for opinions on policy developments and questions around market analysis in one-on-one conversations. It was not surprising but notable how few women were attending the event.
As far as the differences in discussion content, presenters were focusing on 1st generation ethanol (i.e., ethanol derived from food crops such as sugar cane), reporting a wait-and-see approach with 2nd generation ethanol (i.e., ethanol derived from non-food sources such as bagasse, fiber remaining after extracting sugar juice from sugar cane).
For instance, when asked about the availability of government support for 2nd generation ethanol in the Philippines, Archie Amarra, VP at Roxas Holdings (Philippines), commented: “No, we are still struggling with the 1st generation [using molasses as feedstock].” As another example, Shayan Aslam Khan, General Manager at Dewan Mushtaq Trade (Pakistan), briefly mentioned that the company is at “the very initial stage” of looking into cellulosic ethanol. In contrast, in the US and Europe, the 2nd generation biofuels generate far more interest.
Another notable difference was the amount of time spent on the topic of sustainability. Overall, the discussion of the ethanol industry through the sustainability angle appeared to be marginal, while the theme of sustainability seems to take center stage in the US and Europe.
That said, several speakers noted the importance of using resources in smarter ways. For example, Yash Mankame, Director at Praj Far East (India), stated that “business and environmental sustainability goes hand in hand” and presented a case for common sense improvements that can be made to an ethanol plant such as smarter energy and water management.
As another example, Rangsit Hiangrat, Director at Cane and Sugar Industry Policy Bureau Office of the Cane and Sugar Board (Thailand), noted that over the past 10 years, the Thai government has been supportive of converting sugar mills to “sugar complexes” by introducing new value-added products such as cogeneration heat and power, bagasse pulp and ethanol.
Social and content differences aside, this conference provided an excellent opportunity to get a feel for current trends and challenges in the ethanol sector.
Christoph Berg, Managing Director at F.O. Licht, in his presentation on outlook for ethanol world production and trade forecasts a decrease in demand for ethanol in the US and the European Union, in contrast to Asia, where he expects an increase in demand.
That said, it is unclear at what rate the biofuel market in Asia will grow. The ethanol industry is facing notable challenges adversely affecting further growth.
One challenge is public opinion about the effect of gasoline blended with ethanol on the longevity of a car engine. The experience in Thailand is illustrative. Thailand government officials made a decision to replace regular gasoline (91 octane rating) with E-20 (80% gasoline and 20% ethanol by volume) in January 2013. When asked on how well the mandate to ban regular gasoline is going, Prasert Tapaneeyangkul, Former Secretary-General at Office of Cane and Sugar Board (Thailand), noted: “Adoption is not going too well, the perception that gasohol [low ethanol blend] will ruin older car engines is strong.”
Another challenge is the continued food versus fuel debate. As Christoph Berg, Managing Director at F.O. Licht, noted “the myth that biofuels replace food is still strong.”
In the context of food versus fuel debate, what I find odd is that the quality of food does not seem to be taken into account.
Let’s take sugar as an example. Sugar is devoid of vitamins and minerals, consumption of sugar (especially as high as in the US) degenerates health. Yet, the Indian government mandates sugar mills to sell 10% of their total production to the government at discounted prices for distribution to poor families. When sugar prices go up, does that really have to reignite the debate of food versus fuel?
When the price of corn and soybeans soars, should our attention really be diverted to the food versus fuel debate? Or should we ask ourselves why we, as consumers, consider a dizzying number of processed products to be food (most of which list corn, soy, along with their derivatives high on the ingredients’ list)? Or ask why do we feed corn and soybeans to cows that are evolved to thrive on grass?
As societies around the world are bombarded with industrial foods, it is remarkably easy to lose track of what is real food (the kind that promotes health and vitality). It seems that the debate of food versus fuel cannot be complete without rebooting our definition of and relationship with food.
In summary, despite the challenges facing the ethanol industry, it is exciting that people around the world continue to take steps to provide alternatives to petroleum.