CHEMREZ Technologies Inc., a wholly owned subsidiary of D&L Industries Inc., has started operating at optimal capacity of its coco-biodiesel plant in Quezon City.

Dean Lao Jr. Chemrez president, said oil firms ramped up orders ahead of the effectivity of the increase in biodiesel blend to 3 percent (B3) this month of October.

Lao said the company is considering repurposing some lines for other oleochemical products to produce coco-biodiesel once the mandated blend is increased further. 

Demand for biodiesel is expected to continue to grow as the government intends to increase the mandated coco-biodiesel blend to four percent (B4) next year and to five percent (B5) by 2026.

Lao said the company is also ramping up the production of its higher margin coconut oil products such as Laurin smedium chain triglycerides which is fast gaining popularity in the domestic and export markets.

“We have to weigh carefully which will be more beneficial for us to expand,” said Lao noting that both products use the same raw material and similar production lines but the margin for food and other applications is higher while biodiesel has higher volume but a lower margin.

Chemrez is the country’s largest biodiesel manufacturer and an increase in blend to three percent should lead to a 50 percent increase in biodiesel volumes which may also result in better margins and profitability for the industry. There are about 14 biodiesel manufacturers in the country.

“This directive from the DOE is a huge step towards progress and the development of the biodiesel and coconut industry in general,” said Lao.