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Bioenergy Australia calls for ethanol industry investment to safeguard supply and fuel regional economies

As supply lines from China reopen, Bioenergy Australia is calling on the federal government to support hand sanitiser manufacturing businesses to continue to buy Australian Ethanol, as the active ingredient in hand sanitiser and surface disinfectants, as cheaper imports re-enter the market.
“At a time like this we need to focus on supporting our domestic industries," says Former Liberal Party leader, economist and Bioenergy Chair, Dr John Hewson OM.

In 2018, Manildra Group commissioned an ethanol distillery plant at its Shoalhaven Starches facility in Nowra, New South Wales (NSW), one of the world’s largest wheat starch and gluten facilities (photo courtesy Manildra Group).

According to Bioenergy Australia CEO Shahana McKenzie, there was an estimated 600 percent surge in demand for ethanol during the first stages of the crisis when Chinese and US supply chains were shutdown.

The Australian Ethanol industry – with only three major facilities in the country – made a colossal pivot to rapidly scale up and adapt current ethanol production to help fuel the fight against COVID-19 and protect lives., said Shahana McKenzie.

Creation and uses of ethanol are not widely understood and have led to some confusion and concern as demand skyrocketed due to the COVID-19 crisis.

Ethanol has different forms and uses in production. Beverage alcohol grade, pharmaceutical-grade, and fuel grade. The production of all of these grades is reliant on a stable industry and currently, it is the E10 fuel mandates in New South Wales (NSW) and Queensland (QLD), which ensure domestic supply is protected in the sector, explained Shahana McKenzie.

Without these mandates, Australia would’ve been entirely reliant on importing ethanol from China, which had an export shut down for 40 days straight, and from the United States (US).

At a time like this, we need to focus on supporting our domestic industries. Ethanol is part of the emerging biofuel industry in our country, which can provide large growth areas for jobs in regional Australia moving forward. The Australian Ethanol producers were here when ethanol supply from China shut down for 40 days and we want them to be here now and even stronger into the future, especially in the face of potential future waves of the virus that may again disrupt global supply chains. Otherwise, we’re vulnerable. It’s a huge risk, said Former Liberal Party leader, economist and Bioenergy Chair, Dr John Hewson OM.

Dr Hewson explained protecting Australian lives and rebuilding the economy are two core focuses for the federal government as we emerge from the public health crisis. He said investing in Australian biofuels will support both of these priorities, plus give additional security of fuel supply, which was also voiced as a concern with global export shutdowns.

As a country, this can be a defining moment in our future. Do we make a move to safeguard the supply of critical need products by investing in, and supporting, local industries like Australian Ethanol, which also deliver economic benefits and jobs to regional economies, at a time when it’s sorely needed  – or do we return to our reliance on importation? said Dr John Hewson.

Call to support domestic ethanol producers

Bioenergy Australia is urging government, industry, and business to put the issue front and centre and support local producers, such as family-owned Australian Manildra Group, who is making substantial investments to expand operations to be able to produce more ethanol for Australia’s needs.

A privately-held Australian owned company, Manildra Group produces a range of Australian food and industrial products — including wheat flours, bakery mixes, vital wheat gluten and proteins, starches, syrups, ethanol, stock feeds, fats and oils, and bags — for domestic and export markets.

The group has just announced the expansion of its state-of-the-art distillery in Nowra, NSW, to produce an additional 90 million litres of ethanol for pharmaceutical and beverage industries.

Manildra Group Managing Director John Honan explained their Nowra-based distillery has been operating around-the-clock to increase the production of pharmaceutical-grade ethanol, the active ingredient in hand sanitisers and surface disinfectants.

The expansion of the distillery will provide 100+ jobs during construction as well as provide additional ongoing employment opportunities at Manildra Group’s ethanol plant. This further investment will provide a much-needed boost to the community of Nowra and the NSW economy, said John Honan.

The coronavirus pandemic has highlighted the vulnerability of Australia on global supply chains with shortages on other essential ingredients and packaging, as reported by the hygiene industry body, Accord, in their latest survey findings.

This will not be the last time that ethanol demand is critically high. It’s important we translate the learnings we’ve had as a country during the COVID-19 crisis now, and have these critical conversations on how we can secure vital supplies to protect Australians, concluded Shahana McKenzie.

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