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Integrate or leave the party

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  • Integrate or leave the party

    (automatically updated/inserted from The Big Biofuels Blog)


    One comment late in the day got me thinking yesterday. A delegate said that at the moment ‘the profit is with the crushers’ this made me realise that there is not much integration in biofuels from the soil to the wheel. And in other industries I’ve written about if integrated players go to the wall, it is not usually because they have charged themselves too much for thief feedstock. But I have seen plenty of smaller non-integrated players either get bigger and integrated, or get out of markets. Integration can have advantages, the main one being that you can take your profit anywhere along the chain. So who’s going to be the owners in five years. If I’m still around then, please throw this back in my face, but my guess today is big firms energy firms, possibly a couple of commodity players, ADM, Cargill, Abengoa, and possibly a couple of technology firms or their spin-offs, if they can stretch their business models enough. The 2006 European Biofuels Forum is being held in Warsaw, Poland from 20-21 November and is organised by the World Refining Association.

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