Biodiesel to drive up the price of cooking oil

It takes 7.5 pounds of oil to make one gallon of biodiesel.

If you think the high price of gas has been irritating, wait until you see the cost of french fries.

The popularity of biodiesel–made from vegetable matter intead of fossil fuels–”will tighten the supply of vegetable oils,” William Camp, executive vice president of Archer Daniels Midland, said during a presentation at the ThinkEquity Partners Growth Conference in San Francisco.

Because agricultural prices typically fluctuate with supply levels, the vegetable oil shortage could cause food prices to rise.

Martin Tobias, CEO of Seattle-based biodiesel start-up Imperium Renewables, agreed. Vegetable oil prices have declined in the past three weeks because projected demand for biodiesel has come down from the speculative levels achieved a few weeks ago. Nonetheless, lowered levels of projected demand still seem destined to make supply difficult.

News.com