THE ECONOMICS OF BIODIESEL AND ETHANOL AS RENEWABLE FUELS FOR THE PEOPLE OF LAOS BASED UPON A SOYBEA

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THE ECONOMICS of BIODIESEL AND ETHANOL AS
RENEWABLE FUELS FOR THE PEOPLE OF LAOS BASED UPON
A SOYBEAN MODEL
PREPARED AND PRESENTED BY ASIAN QUALITY CO.,
LTD. WITH THE ASSISTANCE OF DR. AMORNVADEE
PORMAJANYA BASED UPON A REPORT BY THE AMERICAN
SOYBEAN ASSOCIATION
SAFARI SEEDS DR.D.H.SIMPSON bio_at_safariseeds.com
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The energy crisis is not over
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• OPEC production decisions have increased world
  oil prices more than 60 percent over the past two
  years.
• U.S. domestic oil production continues to decline
  and is currently 35 percent below 1973 levels.
• The U.S. couldnt refine more crude oil even if
  we had it because refining capacity is virtually
  maxed out.

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Crude oil prices remain at near record levels
Crude oil price, West Texas Intermediate)
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. Source U.S. Energy Information Administration
Petroleum Supply Annual
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Dependence on Imported Oil Continues to Grow
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Source U.S. Energy Information Administration
Petroleum Supply Annual
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Declining oil production and high imports are
only part of the problem
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Source DOE/EIA Federal Reserve Board
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Biodiesel and ethanol are part of the solution
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• Increasing the percentage of renewable fuel in
  gasoline from 0.8 in 2002 to 5 by 2016 will
  reduce oil imports by a total of 4.4 billion
  barrels.
• The savings to consumers from reduced oil imports
  is a de facto tax cut totaling an additional
  54.5 billion. This means that more disposable
  income will be available for consumers to spend,
  save, and invest.
• This fiscal stimulus combined with the
  investment spending to increase biodiesel and
  ethanol production will stimulate the economy.

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Objectives of study
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• Analyze the agricultural sector and macroeconomic
  impacts of the Hagel-Johnson renewable energy
  bill (S.1006)
• Requires a minimum percentage of motor vehicle
  fuel sold in the U.S. must be renewable fuel.
• 0.8 in 2002 to 5 by 2016
• Renewable fuels are biodiesel, ethanol or other
  fuel produced from biomass and biogas.

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Under S.1006 renewable fuel use will continue to
grow with cellulose conversion and biodiesel
playing a larger role.
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Source DOE/EIA USDA
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Biodiesel Assumptions
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Biodiesel Production
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Ethanol Assumptions
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U.S. Soybean Stocks and Prices
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Soybean Meal
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Soybean Oil
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Cash Receipts
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Farm Income
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How do consumers benefit from renewable fuels?
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• OPEC produces 42 percent of the worlds crude
  oil. This cartel acts as a single large supplier
  to influence prices.
• High world oil prices impose higher costs on all
  consumers. This is a tax that redistributes
  income from consumers to OPEC producers.
• Biodiesel and ethanol displace crude oil.
  Increased use will reduce dependence on oil
  imports and reduce the OPEC tax.
• Renewable fuels made from agricultural products
  increase farm income and reduce government
  outlays for farm programs.

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Displacement of imported oil will provide a tax
cut for consumers resulting in significant
direct savings
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Source DOE/EIA
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Increased use of renewables will reduce
dependency on imported oil(Percent of Refinery
Inputs Supplied by Imported Oil)
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Source DOE/EIA
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Expanding biodiesel and ethanol will have
significant positive economic effect
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THEREFORE USING THE ABOVE MODEL WE CAN
EFFECTIVELY WORK OUT THE ESTIMATED BIODIESEL
PRODUCTION COST PER LITER BASED UPON ANY OF THE
FOLLOWING OIL SEED IMPUTE PRODUCTION VALUES
VEGETABLE OIL SOURCES FOR BIO DIESEL AND THE
YIELDS   CROP KG OIL /
HA LITERS OIL/HA CROP
KG OIL / HA LITERS OIL/HA
AVOCADO 2217 2638 LINSEED
402 478 BRAZIL NUTS 2010 2391
LUPINE 195
232 CALENDULA 256 305
MACADAMIA NUTS 1887 2246
  CAMELINA 490 583 MUSTARD SEED 481
572   CASHEW NUTS 148 176
OATS 183 217   CASTOR BEANS 1188 1413
PALM OIL 5000 5950
  COCOA 863 1026 OLIVES 1019
1212   COCONUT 2260 2689 POPPY 978
1163 COFFE 386 459 PEANUTS 890
1059 CORIANDER 450 536 PECAN
NUTS 1505 1791 CORN 145 172
PUMKIN SEED 449 534 COTTON 273 325
RAPESEED(CANOLA) 1000 1190
EUPHORBIA 440 482 RICE 696 828
HAZELNUTS 405 482 SAFFLOWER 655
779 HEMP 305 363 SESAME SEED 585
696 JATROPHA 1590 1892
SOYBEAN 375 446 JOJBA 1528 1818
SUNFLOWERS 800 952 KENAF 230 273
TUNG TREE OIL 790 940
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• ESTIMATED COST OF BIO DIESEL PRODUCTION PER LITER
  BASED UPON CASTER BEAN OIL

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ESTIMATED COST OF BIODIESEL CONTD
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ESTIMATED COST OF BIODIESEL CONTD
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ECONOMIC SPREADSHEET
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ECONOMIC SPREADSHEET
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TOTAL PROJECT BUDGET

• THE TOTAL PROJECT COSTS INCLUDING THE FOLLOWING
  WILL BE
• 1) OIL PRESSING FACILITY FOR CASTOR BEANS AND ALL
  ANCILLARY EQUIPMENT AND SERVICES USD 5 MILLION
• 2) CTER BIODIESEL FACILITY COMPLETE WITH ALL
  ANCILLARY EQUIPMENT AND SERVICES USD 25 MILLION
• 3) ETHANOL BIO MASS FACILITY COMPLETE WITH ALL
  ANCILLARY EQUIPMENT AND SERVICES USD 20 MILLION
• 4) THEREBY THE TOTAL PROJECT COSTS WILL BE USD
  50 MILLION

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FROM THE FEASABILITY OF THIS SOYBEAN MODEL AND
USING THE CASTOR BEAN AS OUR RAW IMPUTE OIL, WE
CAN SEE THAT THE OVERALL VIABILITY OF BIODIESEL
AND ETHANOL PRODUCTION IN LAOS NOT ONLY PROVIDES
AN ENERGY SELF SUFFICIENCY FROM THE CASTOR BEAN,
BUT ALSO CREATES STABLE FARM INCOMES. WE AT ASIAN
QUALITY CO., LTD ,ARGE POLLUX GROUP AND DR.
AMORNVADEE PORMAJANYA LOOK FROWARD TO COMPLETING
THIS PROJECT FOR LAOS AND THE PEOPLE OF LAOS