Logo of Phnom Penh Post newspaper Phnom Penh Post - Biofuel plant delays production by another six months

Biofuel plant delays production by another six months

Biofuel plant delays production by another six months

CAMBODIA’S first biofuel production plant has pushed its restart back until at least July, as the high prices of cassava continues to halt company plans, according to company officials.

“At the moment, we have no plans to reopen, but we hope to restart in July of this year,” said Kim Jong-ho, director of administration at MH Bio-Energy Cambodia.

“The price of cassava remains high. We are waiting for the price to decrease, and now, we are harvesting our cassava,” he said yesterday.

South Korean MH Bio-Energy plant is a Kandal province factory that uses cassava to produce ethanol for sale largely to Europe. It first opened in November 2008 with an initial investment of US$30 million.

In 2009, MH Bio-Energy plant exported 29,406 tonnes of bio-ethanol to European markets.
 
However, the plant’s doors have been closed since May 2010 because of rising crop prices.

The firm has acquired some 8,000 hectares to plant cassava in a bid to end purchases of cassava on the open market, but to date has only planted 1,700 hectares.

“It is not enough for our production,” said Kim Jong-ho. “We need to plant 6,000 hectares of cassava to support our production this year.”

The factory requires 10,000 tonnes of cassava per month to produce bio-ethanol, a compound that can be blended with petrol.

Dry-chip cassava currently fetches $240 per tonne, which is a hike up from $170 to $180 per tonne the product commanded on markets this time last year, he said.

MH Bio-Energy had already postponed its re-launch due to similar concerns. In October, the firm’s Chief of Administration Boeun Thy had said he had anticipated a December restart, due to the high price of cassava.

Banteay Meanchey province cassava farmer Chok Pouk said that cassava prices rested on demand, largely from Thai and Vietnamese markets.

She currently sells at 2,800 baht or $93, per tonne for the unprocessed crop, up from 1,200 baht or $45 last year.

Cambodia ought to push to open markets other than Thailand and Vietnam to increase opportunities for farmers, she said, adding her farm had increased to 400 hectares on the back of larger demand.

“I hope there will be a new market in China,” she said. “We’re looking to export to China soon.”

Last month, Prime Minister Hun Sen said a deal on cassava was to be signed during a five-day official to China.

MOST VIEWED

  • Government hits back at threats to pull EBA, suspend UN seat

    The spokesman for the ruling Cambodian People’s Party (CPP) has said the government is in no way concerned after the European Parliament gave it three months to reverse what it called the “systematic repression of the political opposition”. Ignoring the ultimatum could mean facing

  • Chinese influx pushing locals, Westerners out of Preah Sihanouk

    Some within the Kingdom’s tourism industry have speculated that the recent influx of Chinese visitors may hinder domestic tourism as the price of accommodations in the coastal city of Sihanoukville continues to rise. Preah Sihanouk province, which has become a hotbed for Chinese investment

  • Sar Kheng: Sokha requested security

    Interior Minister Sar Kheng on Sunday revealed the story behind the transfer of former opposition party leader Kem Sokha from Trapaing Phlong prison in Tbong Khmum province to his house in the capital. Speaking at the ruling Cambodian People’s Party (CPP) headquarters in Prey

  • ‘Dire consequences’ from sanctions, warns AmCham

    American businesspeople in Cambodia have warned that any sanction against the Kingdom would have “dire consequences” that could push Cambodia even further into the arms of China. In a letter to US senators and representatives dated Monday, the American Chamber of Commerce Cambodia (AmCham) said