LONDON, November 1 /PRNewswire/ -- The global interest for biofuels will have a considerable affect on fertilizer demand. This is according to Integer's latest report, The Biofuels Boom and Fertilizers.

"The biofuels boom will have a significant impact on N, P and K fertilizer consumption" says Integer Director, Oliver Hatfield. "Our global forecasts for 2012 show that total biofuels related NPK consumption is expected to exceed 6.4 million tonnes of nutrients. The US will consume the largest portion at 42%, followed by the EU at 31%."

"The US and EU are the largest markets for nitrogen and phosphate. This is due to the dominance of maize and rapeseed cultivations. I expect that by 2012, biofuels will make up 12% of US nitrogen fertilizer demand. Similar growth can also be expected in phosphate consumption," says Hatfield.

Brazil will consume 22% of the expected 6.4 million tonnes of nutrients. Much of this will be potash, to be applied to its vast sugarcane plantations.

"Our report looks at the influence the biofuels boom will have on the fertilizer market, by crop, by nutrient and by country. This includes the major biofuels countries, and the emerging countries. For example, Malaysia did not have a single commercial biodiesel unit until 2006. Since then, 32 new biodiesel plants using palm oil have been granted licenses. This could see production in Malaysia soar from nothing in 2005 to about 2.4 million tonnes in 2008."

Global biofuel production is expected to exceed 55 million tonnes of oil equivalent by the end of 2012. Global biodiesel production is likely to reach 15 million toe in 2012, whereas bioethanol production will be closer to 40 million toe.

"The reason for this increased production is because the use of crops for biofuels has become more economically attractive," says Integer's biofuel analyst, Andrea Valentini. "The three main drivers for this recent change are high oil prices, concerns over the effects of vehicle emissions on the environment, and governments looking for energy security."

"Governments are actively encouraging and subsidizing renewable fuels, and this will influence the demand and supply in the major biofuel consuming countries. For instance, to meet the guidelines of EU directives, Europe alone would have to produce 20 million toe of biofuels by 2010. This is a five-fold increase over current output," says Valentini.

In the US, consumption of maize for bioethanol has increased from just over 10 million tonnes per year in 2000 to almost 50 million tonnes in 2006. This is roughly equivalent to the volume of US maize exports and about 15% of national production.

Hatfield continues, "As a result, growing crops for biofuels is financially attractive for farmers worldwide. Depending on geography, these will mainly be crops like rapeseed, soybean and palm oil for biodiesel production, or corn and sugar cane for bioethanol. To meet rising demand, farmers will need to replace their traditional crops, look for new arable land or boost yield. This will certainly have a positive effect on the demand for fertilizer."

Contact details: Kingsley Maunder Integer Research Ltd +44-20-7503-1265

http://www.integer-research.com

Contact details: Kingsley Maunder, Integer Research Ltd, +44-20-7503-1265