EU sees biofuel consumption drop by 2031, palm oil imports collapse

PARIS, Dec. 9 (Reuters) – Biofuel consumption in the European Union is expected to decline by 2031 as road transport moves away from fossil fuels, while palm oil imports fall, curtailed by regulations stricter environmental standards, the European Commission announced on Thursday.

In its Agricultural Outlook 2021-2031, the Commission predicted that biodiesel use in the EU would drop 24% to 14.3 billion liters in 2031 after peaking to 18.9 billion liters in 2023.

The use of bioethanol would be less affected because it also has non-fuel applications, but it would still lose 10% to 6.4 billion liters in 2031 after increasing to 7.1 billion liters in 2023.

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The decline of biodiesel would mainly affect the use of palm oil due to stricter sustainability criteria, while the use of rapeseed oil is expected to remain stable, accounting for around half of the biodiesel feedstock, a- he declared.

Under the EU’s Renewable Energy Directive, palm oil-based fuels are to be phased out by 2030, as palm oil has been classified by the bloc as causing excessive deforestation, a move that has sparked outrage from the two largest palm oil producers in the world, Malaysia and Indonesia.

Imports of palm oil into the EU are forecast to fall to 4.0 million tonnes by 2031, from 6.5 million tonnes in 2021, with most of the decline attributed to lower demand for biodiesel, the Commission said.

The EU is expected to remain a net importer of biofuels, but imports of biodiesel are also expected to be limited by countervailing duties on imports from Argentina and Indonesia.

In the production of ethanol, the Commission expects maize to remain the main raw material, with a share of around 44%, while the use of wheat is expected to decline and other grains and beet to sugar would remain relatively stable.

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Report by Sybille de La Hamaide; Editing by Bernadette Baum

Our Standards: Thomson Reuters Trust Principles.

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