France’s Sofiproteol to close 2 biodiesel units

French oilseed group Sofiproteol said it will close two units of its biodiesel branch Diester Industrie because of overcapacity.
The biofuel industry has been dealt a blow by a European Commission plan to limit crop-based fuels to 5% of consumption, after claims they add to food price volatility and bring few environmental benefits, whereas producers had expected to reach a 10% level.
Diester’s reorganization will cut 380,000 tons of annual capacity through the closure of the Coudekerque biodiesel unit near Dunkirk, along with a unit at the Venette plant, it said.
The closures due by the end of 2013 will reduce Diester’s capacity in France from 2 million tons per year to around its current production level of around 1.6 million tons.
“We have a structural overcapacity of 400,000 tons,” Yves Delaine, deputy chief executive of Sofiproteol, said during a call with journalists.
The reduced capacity would correspond to the 7% biofuel incorporation level currently required in France and at which the government has said it wants to pause, he said.
Diester plans to transform its Venette unit in northern France by the end of next year into one producing biofuel from recycled cooking oil and animal fat, with a target capacity of 80,000 tons.
The Coudekerque unit on the north coast, which Diester says has been hit by the closure of a nearby Total refinery and cheaper imports, is to be mothballed.
As part of a wider reorganization, Diester, which has 3 million tons a year capacity in Europe, is to be folded into Sofiproteol’s vegetable oil branch Saipol next year and the biodiesel maker’s current name will be dropped.
(July 5, 2013)