The main activity of Biofuels is the large scale production and exploitation of biodiesel and glycerine following the construction and commissioning of the initial plant.

Biodiesel is produced from vegetable oils and, as an environmentally friendly product, can make a significant contribution towards reducing green house gases and meeting Kyoto targets.



RNS's from BFC can be viewed at:

http://www.uk-wire.com/cgi-bin/index?search_type=3&words=bfc&go.x=17&go.y=8

http://www.biofuelscorp.com/

From Saturday mail.......

BIOFUELS AIMING TO LIFT SPIRITS-investment extra by Brian O'connor

You could, of course stay at home and make your own diesel out of vegetable oil. This is the game plan at Biofuels Corporation which enjoyed some 'animal spirits' this week, soaring 53p to 258.5p to value it at 75 m.
The rise was on an 'illustrative projection' of 30 mill a year profits from its first factory. Since it could build 5 more plants, excited punters multiplied 30 m by 6 and rushed to buy.
The factory will not be built untill july. It needs funding, so a share issue looks imminent.
Diesel from vegetable oils is very costly and needs big tax breaks to be economic. Several firms already make it using rape seed oil.
Biofuels aims to use palm oil, which is cheaper but attracts flak from 'greens' over deforestation.
Diesel for cars is only allowed to contain 5% 'biodiesel' so the market is limited.
Biofuels could still be worth a punt. It has hired good managers, but competition abounds, so do no get overexcited. Running with the bulls is fun, but keep an eye on the exit.

Jules - interesting. Your messaging isn't activated - mine is! ;-))

Dailos - very true and thanks for spotting it. I've checked a few newspapers over the weekend and found little. Happy to run, but aware it's driven by newsflow.

Jules, this chap who will take 50% of a placing himself given the chance, is it because the price is favourable (eg 200p) or because it's worth having at any price? Whatever, it sounds like a good bullish phase is approaching. That's fine by me with my holding :)

Dailos - am puzzled by your statement "Diesel for cars is only allowed to contain 5% 'biodiesel'".

I thought EU and UK directives were aiming for 20% by 2008 or something, Who is limiting the biodiesel content currently? Don't think this is right. Please state source.

SD

stockdog
I aint got a f*cking clue! just copied and pasted an article sent to me as part of a roundup of weekend press stories, this one from Brian O'Connor by the looks of it.
Have reduced BFC holding, but still quite long.
d.

Its possibly correct. Petrol and diesel rules vary from country to country. They might be standard for the EU. The rules define limits for various parameters, eg flash point, autoigntion temperatures, boiling points, maximum amounts of certain chemicals, etc. It could well be that a main chemical is biodiesel currently has a limit on it to ensure a quality parameter of diesel is okay.
If you accept that you are getting a different product, then there should surely be different rules. As a buyer of petrol (for example), I wouldn't want it thinned with alcohol like the American gasoline - alcohol contains oxygen and that is in the air, so why pay to fill my tank with some? On the other hand, if I was buying biodiesel on ethical grounds - forget the deforestation for a moment - then I'd want 100% surely. Another reason for these rules is for example too much lead in the old petrol might leave deposits, too much sulpher can lead to bad emissions, octane ratings in petrol and cetane ratings in diesel should be okay. Odd stuff in the fuel can corrode fuel lines. Other things can affect the freezing temperature of the fuel.

I dont know! All I'm saying is there might easily be an existing limit on diesel which restricts the content of biodiesel in diesel. Whatever the case, 5% of the market is big, and we can surely expect the limit to change, or biodiesel to be marketed as a separate product with its own rules.

I too would appreciate a reference for the 5% remarks!

=

I don't think a biodiesel company should set out to make 6 refinaries.
I think they should start by refining to prove it works, and then buy a source of the bio-product, otherwise the price of the organic material will be beyond their control. Hedging is a short term strategy, like car insurance. Crash your car and the insurance cost goes up. How long can BMW hedge their $€X rate? Long term it doesn't work. Hedging stabilizes something volatile, but it doesn't cure a trend. Once you have source and refinary you can play around with quantities to maximze profit while limiting risk, but they should have a foot in both doors.

Thanks, crystalclear - interesting thoughts.

Still asking myself the price differential (mid to long term) of locally processed jatropha beans versus transported palm oil.

SD

Why is BFC moving down whilst DOO is moving up?

>> hlyeo

What makes you think they should always move in the same direction?

BFC is settling back to a new trading base, whilst DOO which got to its peak earlier is now exploring a gentle rise off its new base.

Both should be a constant opportunity of buying in the dips, and even trimming at the peaks if you can spend that much time watching, over the course of the year until they start producing a regular cash stream when they will probably become less volatile.

Their principle difference will remain that BFC is a hardware company, building plants, but not growing them, whereas DOO is more a software company growing the plants, but not investing in building them. The latter get the edge in my estimation by JVing on the plant (construction that is).

My favourite plant is of course the dog rose.

SD

And of course neither stock is a dog...eh SD.

rgrds
gk

The cat's whiskers, definitely! gallick.

oh dear !

Where are they going?http://bfc

Don't ASC me! Looks like a really good dreary down-hearted day to BUY more.

SD

Grabbed some more at 230p. ;-)

Cashed them in +8

Food for thought (excuse the pun)


Published on 7 Mar 2005 by Dow Jones / Yahoo. Archived on 8 Mar 2005.

Biodiesel Boom Raises Ethical Issues -Analyst
by Benjamin Low

KUALA LUMPUR (Dow Jones)--High crude oil prices may have galvanized bio-diesel production, but some questions are now being asked in industry circles about the ethics of using a limited edible resource to meet the world's energy needs, said an influential edible oils industry analyst.

Dorab E. Mistry, director of London-based Godrej International, said he opposes the practice of burning what is an essential food item and believes non-governmental organizations in Europe, where the bulk of the world's bio-diesel is produced, will soon raise their protests.

"The NGOs in Europe will realize the folly of burning an edible oil for fuel and get in on the act," Mistry said in an interview on the sidelines of the recent annual palm oil price outlook conference in Malaysia.

Even the need for cleaner-burning fuel sources for environmental reasons doesn't entirely justify the use of vegetable oils such as soyoil, palm oil and rapeseed oil, he said.

"Clearly, there are alternatives to reducing carbon emissions by using better technology and that is the way forward; not burning an essential edible oil," said Mistry, who has been involved in the trading of edible oils for more than 25 years for India's Godrej group.

Ambitious Targets For Bio Fuel Production

The European Union has been at the forefront of bio-fuel production, setting a target of replacing 2% of the region's fossil fuel requirements by end-2005.

Industry publication Oilworld has said the European Union's bio-diesel output could touch 2.4 million metric tons to 2.6 million tons in 2005, sharply exceeding the 700,000 tons produced in 2000.

The bulk of Europe's bio-fuels are derived from rapeseed oil. Oilworld estimated that close to half of all of the region's rapeseed oil output could go toward bio-diesel production this season.

It would be acceptable to burn edible oils for fuel in times of severely low prices caused by a glut to protect the interests of farmers and producers, Mistry said.

However, for edible oils, now isn't the time as the supply and demand are at a balance and prices are attractive for producers, he said.

"So for that reason, I would ask the people who are planning to use government subsidies for burning oil to go easy," he said.

Mistry forecast global edible oils supply and demand to grow at an even rate of about 5% in the year. Estimates from other edible oils analysts such as Oilworld and James Fry have also indicated marginal differential between supply and demand growth.

By subsidizing the production of bio-diesel, governments may be preventing edible oils from being put to better use, namely as food for the world's population, Mistry said.

"They are also subsiding ethanol from beet and corn, where there is definitely huge overproduction so, that can continue. But for vegetable oils, where there is a tight supply and demand situation, subsidies should be taken out."

Currency Changes May Spoil Bullish Mood

Meanwhile, Mistry said palm oil market players need to be cautious about the bullish price forecasts made by industry analysts at the annual price outlook conference held in Kuala Lumpur March 2-4.

Analysts, including Mistry, had forecast palm oil prices to range from about MYR1,300/ton to MYR1,500/ton in 2005.

At 0930 GMT, the benchmark May CPO contract was trading at MYR1,434/ton, up MYR46 from Friday's close.

While the projections point to further upside room, Mistry said market players shouldn't "get carried away."

That's because a revaluation in Asian currencies, including the Malaysian ringgit, may be possible in the coming year.

There has been persistent speculation since late last year that the Malaysian ringgit, pegged at MYR3.8 to the dollar, would be revised to a stronger rate if China revalues its currency, the yuan.

"I think it's generally accepted that if the yuan is re-valued, other Asian currencies which are also seen to be undervalued, like the ringgit, will also be re-valued," Mistry said.

"We have to take that into account that it will happen in the next 12 months."

A stronger ringgit would put downward pressure on the ringgit price of Malaysian CPO as there would be limited room for an adjustment in the dollar-denominated export price, he said.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Very interesting, gallick.

It confirms the question, if not the answer, I have over palm oil favoured by BFC as opposed to jatrpopha favoured by DOO. I tend towards DOO as the cleverer long-term play - jatropha beans are, I believe, poisonous and therefore are not part of the potential food chain.

SD

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