Japan to boost biofuels output

Japan’s Agriculture, Forestry and Fisheries Ministry plans to introduce new legislation that will help boost domestic biofuel production. Under the envisioned law, the ministry plans to ease regulations so biofuel producers that use domestic raw materials will be able to build a factory on the farm where the crops are harvested to reduce transport costs. The ministry will also consider cutting or waiving property tax on production plants, and devising a way to cover losses in case of a poor harvest due to bad weather. For firms that produce a gasoline-biofuel mixture, the government is discussing subsidies to reduce the cost of domestically produced biofuels to less than the currently targeted ¥150 (US$1.21) per liter, to compete with Brazilian biofuel, which is sold at around ¥100 (US$ 0.80) per liter. The government aims to produce 6 million kiloliters of biofuels annually, which is equivalent to 10% of domestic gasoline consumption, by 2030. (June 13, 2007)