Date: 11 Jul 2007

Shift in the marginal supply of vegetable oil

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Abstract

Background, Aims and Scope

The consequential approach to system delimitation in LCA requires that consideration of the technologies and suppliers included are ‘marginal’, i.e. that they are actually affected by a change in demand. Furthermore, coproduct allocation must be avoided by system expansion. Vegetable oils constitute a significant product group included in many LCAs that are intended for use in decision support. This article argues that the vegetable oil market has faced major changes around the turn of the century. The aim of this study is to study the marginal supply of vegetable oil as it has shifted to palm oil and describe the product system of the new supply.

Methods

The methods for identification of marginal technologies and suppliers and for avoiding co-product allocation are based on the work of Weidema (2003). The marginal vegetable oil is identified on the basis of agricultural statistics on production volumes and prices. A co-product from palm oil production is palm kernel meal, which is used for fodder purposes where it has two main properties: protein and energy. When carrying out system expansion, these properties are taken into account.

Results

The major vegetable oils are soy oil, palm oil, rapeseed oil and sun oil. These oils are substitutable within the most common applications. Based on market trends, a shift from rapeseed oil to palm oil as the marginal vegetable oil is identified around the year 2000, when palm oil turns out to be the most competitive oil. It is recommended to regard palm oil and its dependent co-product palm kernel oil as the marginal vegetable oil. The analysis of the product system shows that the demand for 1 kg palm oil requires 4.49 kg FFB (oil palm fruit) and the displacement of 0.035 kg soybeans (marginal source of fodder protein) and 0.066 kg barley (marginal source of fodder energy).

Discussion

The identification of the marginal vegetable oil and the avoidance of co-product allocation by system expansion showed that several commodities may be affected when using the consequential approach. Hence, the product system for vegetable oils is relatively complex compared to traditional LCAs in which average technologies and suppliers are applied and in which co-product allocation is carried out by applying an allocation factor.

Conclusions

This article presents how the marginal vegetable oil can be identified and that co-product allocation between oils and meal can be avoided by system expansion, by considering the energy and protein content in the meal, which displaces a mix of the marginal sources of energy and protein for animal fodder (barley and soy meal, respectively).

Recommendations and Perspectives

The implication of a shift in the marginal vegetable oil is significant. Many LCAs on rapeseed oil have been conducted and are being used as decision support in the bio energy field. Thus, based on consequential LCA methodology, it is argued that these LCAs need to be revised, since they no longer focus on the oil actually affected.

ESS-Submission Editor: Prof. Walter Klöpffer, PhD (walter.kloepffer@t-online.de)