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1. Palm oil has "bottomed"; RSPB wins against challenge to advert
From: Jim Roland
1. Palm oil has "bottomed"; RSPB wins against challenge to advert
Posted by: "Jim Roland" firstname.lastname@example.org jimroland99
Date: Sat Sep 27, 2008 2:55 pm ((PDT))
Palm Oil Has ``Bottomed,'' OilWorld's Mielke Says (Update1)
By Claire Leow and Pratik Parija
Sept. 27 (Bloomberg) -- Palm oil prices have ``bottomed'' and will be supported by falling supplies of rival soybean oil and rising demand for biodiesel, Thomas Mielke, chief editor of OilWorld, a trade publication, said.
``Palm oil prices are currently undervalued,'' he told a conference in Mumbai today. ``Prices have bottomed, or are near the bottom of the cycle.''
Palm oil, the world's most consumed vegetable oil, can be mixed with regular diesel to stretch fossil fuel supplies. The price of the tropical oil has fallen by half from a record in March amid concerns that global supply may exceed demand.
Global palm oil production will increase 5.7 percent to 44.7 million tons in the year to September 2009, lagging behind a 7.3 percent gain in consumption, said Mielke.
``The use of soybean oil for biofuels will rise in the U.S., Brazil and Argentina, which means their supplies of soybean oil to the world market will fall'' by as much as 3.8 million tons, he said. Palm oil, a substitute, can fill this gap, he said.
Indonesia's palm oil production may grow 9.4 percent to 18.6 million tons this year and slow in 2009, said Derom Bangun, head of the Indonesian Palm Oil Association, at the Mumbai conference. In 2007, production grew 6.9 percent to 17 million tons, he said.
Malaysia may produce 17.6 million tons in the year ending September 2009, said Mielke. Indonesia may increase output by 2 million tons to a record 20.7 million tons in the period.
Vegetable oils made from soybeans, corn, rapeseeds and oil palms, used mostly in food, are increasingly being used to make alternative fuels to reduce the cost of fossil energy. Crude oil rose 2.4 percent this week to $106.89 a barrel in New York.
December-delivery palm oil rose 1.5 percent to 2,313 ringgit ($673) a ton on the Malaysia Derivatives Exchange on Friday. The futures have gained 2.4 percent this week, the first weekly gain in more than a month.
Palm oil may trade between 2,700 and 2,900 ringgit, Mielke forecast Sept. 4. Prices may rise to average $1,120 a ton in the year to June 2009, up from an average $1,041 in the previous year.
The tropical oil may trade between 2,200-2,300 ringgit a ton for remainder of the year, said James Fry, managing director at LMC International, a commodity and biofuel research company, at the conference today.
Soybean oil will probably trade between $750 and $1,000 a ton between now and January, said Nicolas Backer, a trader with Nidera Handelscompagnie B.V., based in Rotterdam. He has traded edible oils for six years.
Prices may reach as high as $1,200 a ton next year if the new crop in South America is damaged by the worst drought in at least two decades, he said at the conference.
``If there's a crop failure, we could have a bull market of $1,400 a ton,'' he said.
Soybean oil traded in Chicago gained 1.1 percent to 47.93 cents a bushel, or $1,057 a ton.
To contact the reporter on this story: Claire Leow in Singapore at email@example.com
Last Updated: September 27, 2008 09:14 EDT
Biofuels complaint thrown out
Last modified: 25 September 2008
Traffic - Andy Hay (rspb-images.com)
The Advertising Standards Authority (ASA) has dismissed a complaint about a national newspaper advert warning against biofuels.
The authority rejected the claim, against an RSPB ad, that UK biofuels were safe for exotic wildlife because they were made from domestic sources.
The ad, published in The Times and Guardian in February 2008, said: 'Don't put wildlife in your tank…the drive for biofuels is wiping out precious wildlife habitats'.
The ASA denied the advert was misleading. It highlighted the warning that some, but not all, biofuel production for the UK market was causing habitat destruction and the loss of wildlife.
The ruling said: "We noted wildlife habitats had already been affected and some could be put at risk if standards were not put in place to ensure that biofuels were sustainably sourced. We understood that no such standards existed at the present time…[and that] mandatory compliance with minimum levels of performance on greenhouse gas emissions reductions and sustainability would not come into effect until 2010 and 2011 respectively."
It added that the ASA "understood that wildlife habitats, such as those of the animals depicted in the ad, had already been adversely affected and could continue to be adversely affected because of the UK's commitment under [biofuels legislation]. We concluded that the ad was unlikely to mislead."
Demand for biofuels, particularly from Europe and the US, is encouraging the widespread clearance of rainforest, peatlands and wetlands for biofuel crops.
The proposed drainage for sugarcane cultivation of parts of the Tana Delta in Kenya was an example of a site under threat, the ASA said.
At least 2.5 per cent of fuel sold on UK forecourts must by law be biofuel but the European Commission could this month raise that figure to nearly 12.5 per cent by 2010.
Dr Mark Avery, the RSPB's Conservation Director, said: "The ASA has accepted the overwhelming evidence that biofuels are damaging wildlife and wildlife habitats. Its ruling comes at a crucial time with the EU, backed by the UK government, set to force us to buy even more biofuel without knowing where it has come from or the harm that its production has caused.
"We should be putting the brakes on biofuels until their manufacture is no longer responsible for the vast and irreparable environmental destruction we are seeing today."
Some biofuels are known to increase greenhouse gases compared to their fossil fuel equivalents. A recent report for the UK government found that more than 80 per cent of biofuels were not meeting voluntary environmental standards set by UK legislation.
A previous study urged UK and EU ministers to moderate new biofuels targets until the impacts of biofuels were known and safeguards to protect wildlife were in place.
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