Bain Capital backed biofuels refiner EcoCeres ties up with China agency to supply feedstock.
Bain Capital-backed biofuels refiner EcoCeres has tied up with a waste administration agency backed by the Chinese language metropolis of Shenzhen to supply feedstock, the corporate mentioned because it expands manufacturing of low-carbon fuels to satisfy fast-growing demand.
The pact between Hong Kong-based EcoCeres and Shenzhen Expressway Group, which handles greater than 2.5 million metric tons of meals waste yearly throughout China, comes as native governments in China step up assortment of feedstocks resembling used cooking oil (UCO) to money in on rising international commerce in biodiesel and sustainable aviation gas (SAF).
China’s Nationwide Vitality Administration mentioned in September that native authorities ought to arrange built-in, “closed loop” methods to effectively accumulate waste cooking oil from eating places, course of it and refine it into low-carbon fuels – a system town of Shanghai has had in place for a decade.
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EcoCeres mentioned in a press release:
The partnership will create a brand new mannequin for feedstock procurement and supply a secure and high-quality bio-grease supply.
China is the world’s largest producer of UCO, with anticipated output of round 11.4 billion litres this 12 months, or 10.37 million metric tons, in keeping with the U.S. Division of Agriculture (USDA).
Nonetheless, solely 25% to 30% of its waste oil is at present collected, in contrast with about 80% within the U.S. and different developed economies, mentioned James Tam, managing director at Bain Capital, which invested $400 million in EcoCeres this 12 months.
A lot of the waste oil collected from eating places in China is dealt with by small, native corporations.
Whereas Chinese language home demand for biofuels stays low within the absence of presidency mandates or subsidy applications, international demand for lower-carbon fuels has pushed fast progress within the commerce of waste oil feedstocks from China.
Along with its services in China, EcoCeres in June introduced plans to construct a 350,000-metric ton per 12 months biofuel refinery in Johor, Malaysia, to satisfy international demand.
UCO traded at about $800 a ton in North Asia in mid-November, in keeping with knowledge from S&P World Commodity Insights, after peaking at greater than $1,600 per ton in Could 2022.
At latest costs, the ten.37 million tons of UCO China produces yearly is price round $8.3 billion if collected and handled, in keeping with Reuters’ calculations based mostly on USDA figures.
“Persons are sensing this can be a industrial alternative and constructing an ecosystem for accumulating the oil,” Tam mentioned.
Bain-backed biofuels refiner ties up with China agency to supply feedstock, Beijing, December 19, 2023
