A proposed measure to temporarily suspend mandatory biofuel blending, amid Middle East conflict concerns over oil supply, is not expected to hurt D&L Industries’ business.
D&L Industries manufactures food ingredients, chemicals for personal and home care, and coconut-based biodiesel through Chemrez Technologies Inc.
D&L president and CEO Alvin Lao said the proposal suspends blending for a year if blended fuel prices are at least 5 percent higher than pure fuel.
“Based on prevailing market conditions, the price differential between biodiesel-blended diesel and pure diesel remains well below the five percent threshold indicated in the proposed legislation. As such, we do not expect any material impact under current market conditions,” he said in a statement Tuesday.
Lao said the differential is about 1.33 percent when diesel prices are around PHP90 per liter.
“The proposed measure is intended as a temporary price stabilization mechanism and does not repeal the Biofuels Act or alter the country’s long-term policy direction toward renewable fuels. We therefore expect the long-term fundamentals of the biodiesel industry to remain intact,” he said.
He added that “Chemrez has the flexibility to redirect production toward higher-value coconut-based oleochemical exports should domestic biodiesel demand temporarily soften.”
“Global demand for sustainable specialty ingredients remains robust. The operational flexibility and resilience we have built over the years allow us to navigate evolving market conditions while continuing to deliver stable growth,” he said. (PNA)
