Vanguarda Agro lets go of biodiesel businesses

Brazilian biodiesel producer Vanguarda Agro is pulling out of the biodiesel market to focus solely on its agriculture business.

It is to sell its two plants located in Rio Grande do Sul to Camera Agroalimentos for about 58 million reais (€24 million).

Vanguarda Agro believes that without government support the biodiesel industry will not be profitable, even through Brazil requires all standard diesel being sold at the pump to include a 5% blend of renewable fuel.

However, diesel is selling for about 15% cheaper than biodiesel which Vanguarda Agro believes could harm profits.

The processing capacity at one of the plants being sold is 900 tonnes of soyabeans a day and the facility includes a loading and unloading rail, as well as links with nearby roads. The facility is able to receive degummed oil for biodiesel production from a plant in Ijuí, which is located 110km away.

A second biodiesel plant in South Rosary has also been acquired by Camera Agroalimentos from Brazil Ecodiesel and has the capacity of 360m³ of biodiesel a day. It is situated in the southern part of the country and has rail and road links connecting to neighbouring Uruguay.

Camera Agroalimentos will use the facility to produce biodiesel from soyabean as well, using 1.8 million tonnes of soyabeans a year – 16% of all the crop growth in the region.

Camera has increased the capacity of the plant from producing 363 million litres of biodiesel last year to processing 1,010m³ a day.