Sustained growth in biofuels rests on government policy support

iStockAnalyst.com
Wednesday, November 24, 2010 9:54 AM

(Source: Datamonitor)After a period of slowdown due to the global recession and high feedstock costs, the biofuels market is now showing signs of recovery. However, in key markets, energy companies such as Petrobras, BP, and Shell are still fighting to recover their losses and attract new investments. Government policies are expected to be instrumental in ushering in the next phase of growth in the biofuels industry.

The biofuels industry has faced a tough period during the last two years due to the global financial crisis, declining crude oil prices, and the surging price of feedstock (especially of corn in the US). Many biofuels projects were reportedly shelved during the last two years after crude oil prices declined to less than $40 per barrel. A slowdown in biofuels research initiatives during this period further added to the woes of the industry.

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