COFCO opens first non-grain ethanol plant in China

In China, COFCO, a leading food producer, opened the country’s first non-grain ethanol plant this week in Guangxi Zhuang Autonomous Region. Capacity, production cost and feedstocks were not disclosed. COFCO, operator of an existing 200,000 ton ethanol plant in Guangxi, had been seeking feedstocks from Vietnam and Thailand as grain availability was curtailed throughout China due to food shortages.

The Ministry of Finance recently announced policies to promote the production of biofuels from non-food feedstocks. The subsidies will be flexible, and tied to the price of crude oil. Farmers will receive up to $878 per acre planted with forest products for biofuels, and up to $791 per acre for crops planted for biofuels.

China has recently announced abandonment of ethanol projects that use foodstocks, excepting existing plants and those already under construction. China is the third-largest ethanol producer, behind Brazil and the US.

In China, the Ministry of Agriculture is reviewing the land allocations for biofuels crops, with clear indications that food would be given priority over fuel. But biodiesel producers, who depend largely on non-food crops, expect to be largely spared from curbs on production.

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