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The Hungarian Secretary of State Zoltan Goghs stated that Hungary has a stable supply of about 2.5 million tons of corn and can produce 800,000 tons of ethanol.
Hungary's biofuel production capacity is expected to reach a scale of 800,000 tons in two to three years, while the current output is only 150,000 tons and is expected to reach 500,000 tons in 2008.
The official said that 2 million tons of corn will be used to refine bioethanol this year, and about one-third of it will be supplied to existing factories in the country. However, when the ethanol production capacity reaches 800,000 tons, the supply of raw materials may be exhausted unless the grain production increases simultaneously.
Goghs said that the manufacturers who will take the lead will have sufficient supplies, and the slower vendors may not have enough supplies.
The Hungarian Ministry of Agriculture has warned that this year may mark the end of a series of consecutive high grain yields. Currently there are still about 5 million tons of food in the warehouse in Hungary, most of which are in the European Union's intervention stocks.
However, when Hungary reaches the ethanol production target, the current technology may be out of date, and producers will switch to second-generation biofuels, which use whole crops instead of grains to produce cellulosic ethanol.
In addition, the constraints faced by the Hungarian biodiesel industry are even more pronounced because factories currently under construction may face shortages of oilseeds, which will process rapeseed and sunflower seeds. However, officials believe that there are not enough raw materials to supply these factories.
Hungarian biofuel industry development will be limited by raw materials
According to Hungarian officials, Hungary's bioethanol production capacity will grow more than threefold next year, and two or three new plants will be put into operation at that time, but factories that will be completed in the future will have to snap up corn supplies.