Biofuel demand hits rapeseed oil prices

Prices have risen 25% over the last 12 months from, typically, £400 per tonne to £500 per tonne. And the increases are set to continue.

Rapeseed oil is used, primarily, in release agents and divider oils, liquid bread fats and dough conditioners and paste concentrates in the baking industry.

Steven Birrell, executive secretary of the Association of Baking Ingredient Manufacturers, says it is inevitable his members will have to pass on the increased price to customers. Speaking to British Baker, Bakels MD Paul Morrow said customers using the oil as a key ingredient will already have had a price increase, but another is likely soon.

But Bakels, which buys around 4,500 tonnes of rapeseed oil annually, says it has absorbed the cost until now for smaller users.

“£500 per tonne is now the base position,” Morrow emphasised. “It is not a peak in the cycle.”

The higher price for rapeseed oil seems set to continue – a new power plant based on rape biodiesel is currently under construction in Scotland.

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