Fleet News

Cheap biofuel supply under threat

With the opposition to the use of biofuels gathering pace, European manufacturers are attempting to restrict the availability of cheap biofuel, which is imported from the US where it attracts significant subsidies.

The European biofuel manufacturing industry has formally requested that the European Commission launches a World Trade Organisation dispute against these production subsidies for US biofuel producers, which it claims are leading to Europe experiencing a "dramatic surge" in US biodiesel imports.

This, say European manufacturers, is "creating a severe injury" to their viability.

If the EU won such a case, these cheap supplies would cease.

In addition, the European Commission president José Manuel Barroso has ordered a major study into how the boom in biofuel production could be escalating food prices.

This is already causing problems within the EU, which recently increased payments for food aid from Euro 650 million to Euro 1.2 billion following food riots in Africa.

If the study concludes that biofuel production is inflating fuel prices, it will increase the pressure still further on the EU to abandon its 10% biofuel growth target.



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