Based on extensive research and financial analysis, BBI has concluded that a canola-based biodiesel industry could be viable based on historical feedstock prices, provided that the price of biodiesel exceeds 72-75 cents per litre. Under such a scenario, the average return on investment across the plants comprising the industry would be 26 to 28% annually.
The aforementioned biodiesel pices exceed the 3-year historical wholesale price for biodiesel by 8 to 12 cents per litre, and thus, a biodiesel price of 72 to 75 cents per litre would be contingent on sustained high prices of petroleum diesel, or government incentives, to ensure the continued economic viability of the industry.
Detailed information can be found in the study, which has 144 pages and a lot of grafics and figures.
Download the study here (PDF document, 4,9 MB)
(Cf. news of 2006-12-07.)
Source: Canola Council of Canada July 2006.