“We set out to boost production, make better use of the resulting carbon dioxide and the edible corn oil we are now producing, though not as much as we would have liked to,” said Octavian Stanculet, general manager of Bio Fuel Energy, part of the InterAgro group controlled by of businessman Ioan Niculae.
The annual capacity of the plant in Zimnicea (a city in the southernmost part of Romania) is 80,000 tons of bioethanol, and actual sales depend on the condition of the Western European markets, to which the company ships 70% of the bioethanol it makes.
“We’ve got a steady supply of raw material, if we have a market we can go up towards 75% of the plant’s capacity,” Stanculet said, adding his company only found buyers for 56% of the production capacity last year.
Bio Fuel Energy also intends to sell ethanol fuel and is preparing to launch a product with a bioethanol content of at least 10%. The advantage of such a blend is lower pollution, as well as lower price, because the bioethanol is cheaper than gas. The content of bioethanol in the gas sold by gas stations in Romania is currently capped at 5% but the market will grow over the coming years, because EU regulations require boosting the percentage gradually to 20% by 2020.
Bio Fuel Energy’s revenue rose from EUR40 million in 2010, its first full year in business to EUR64 million last year. Profitability, however, suffered because of the increase in corn and electricity prices, which account for 75% of the company’s costs together, the general manager said.
The corn it processes mainly comes from InterAgro group’s other companies but only covers half the processing capacity so it needs to buy more from the market. Last year the corn harvest was really poor and the price in Romania overshot the RON1,000 mark in the fall compared with RON720 per ton in the fall of 2011, according to Agriculture Ministry data.
The company owns two gas stations in Teleorman (south of the country) and plans to expand the network by two stations in every county of Romania. It will open three filling stations under its own brand this year, one in Alexandria, one in Giurgiu and in Svishtov, Bulgaria, a city on the right bank of the Danube opposite of Zimnicea.
(English version by Loredana Fratila-Cristescu)