Scots growers could cash in on green biofuel crisis
It became clear yesterday that Scottish wheat growers could have a major opportunity to supply grain to biofuel plants south of the Border – as the farm assurance scheme SQC moved to reassure their producers that their validation for the EU’S renewables energy directive (Red) was still fully up to date.
Concerns were raised in the grain trade in recent days about the ability of UK farm assurance schemes to validate the green credentials of crops grown for the biofuel industry – with merchants expressing concerns that the Red Tractor scheme’s registration with the EU to validate such crops had effectively run out on 6 August.
The requirement for validation was introduced by Brussels to ensure that the growing of biofuel crops did not have negative environmental consequences – and the checks carried out by farm assurance scheme operators was adopted as the method of validation.
The apparent failure of the Red Tractor scheme to gain re-approval has created significant problem for growers in England – with merchants fearing that such crops would no longer meet strict contractual requirements.
However SQC yesterday
0 Wheat prices will be affected by Euro validation row confirmed that its five-year approval period was re-started at the end of June 2015, when barley was added to the list of SQC crops for biofuels – meaning that SQC’S approval will not expire until the end of June 2020.
SQC said that the grain trade, which was very concerned that all the grain they bought for biofuel production was approved for that use, had been informed that SQC grain was still fully approved and suitable for use as biofuels.
SQC chairman Andrew Moir said yesterday that, while the situation was unfortunate for growers south of the Border, it did offer commercial opportunities to members registered with SQC.
“While there’s absolutely no intention to revel in the situation, SQC members will be willing to extend the hand of friendship to help keep the biofuel wheels turning – and this could help improve the outlook for wheat grower sin Scotland,” said Moir. With the Red Tractor scheme currently believed to be in negotiation with the EU over reaching a swift solution to the problem, there was no real indication of how long this opening for Scottish growers was likely to last, but Moir said that there was a possibility that if it took an extended period it could help return the premiums for Scottish wheat which had traditionally existed.
The Ensus plant in the north of England alone has a potential to use over 1.2 million tonnes of wheat a year, with the Vivergo plant consuming a similar quantity in Yorkshire.
However, other industry sources warned that if these plants decided instead to import validated grain from abroad this was likely to displace the use of the home-produced wheat – which could see significant downward pressure on prices.