The Ministry of Mineral Resources and Energy (MIREME) has announced plans to reduce the export tax on vegetable and animal oils, as well as molasses, from eight meticais to 0.20 meticais per liter, while the export tax on pure biofuels will be cut in half from the current 0.20 meticais per liter.
The information, cited by Lusa from a ministerial decree, also states that any company producing vegetable or animal oil, as well as molasses intended for the production of pure biofuels, must allocate part of its output to the domestic market — specifically, 1% of production during the first five years, 2% from the sixth year, and 3% after the tenth year.
The document explains that “there is a need to boost the production of vegetable oil, animal oil, and molasses for obtaining pure biofuels by making the respective projects viable and ensuring their sustainable export, including flexibility in introducing the mandatory blending of imported biofuels.”
The publication adds that producing companies must report monthly to MIREME the quantities allocated to the domestic market, including the names of companies purchasing the vegetable or animal oil and molasses for processing into pure biofuels.
“In the absence of buyers for vegetable or animal oil and molasses, these products must be allocated to the national fuel distribution company under a contractual agreement, taking into account prevailing market conditions,” the decree concludes.
Last year, it was revealed that the development of Mozambique’s biofuel market will require a total investment of around 13.9 billion meticais (190 million dollars), according to a feasibility study commissioned by the Ministry of Economy and Finance (MEF) from consultancy firm Green Light.
The report, reviewed at the time by Diário Económico, was designed to promote the use of renewable fuels in the country and estimates that the investment will be divided between the production of 71 million liters of biodiesel and 82 million liters of bioethanol.
For biodiesel production, the study estimates an investment of 6.9 billion meticais, while bioethanol production will require 6.8 billion meticais. This amount includes costs related to equipment acquisition, agricultural development, and other project implementation expenses.
Biofuel production in Mozambique will rely on crops already grown in the country, such as sugarcane and cassava, with molasses — a by-product of sugar production — expected to meet up to 50% of national bioethanol demand in the project’s first year. It is estimated that 27,000 hectares of sugarcane and 107,000 hectares of cassava will be required to achieve the initial production targets.
The study concluded that despite the high initial investment, the long-term economic and environmental benefits are substantial, allowing the country to advance toward a low-carbon economy and establish a competitive biofuels industry in the regional market.
Source: Diário Económico
