Vietnam's ethanol producers have called for measures to address weak domestic demand, secure raw material supplies and establish long-term purchasing contracts as the country prepares to expand the use of E10 biofuel.

According to the Ministry of Industry and Trade, a delegation led by Deputy Minister Nguyen Sinh Nhat Tan recently visited ethanol (E100) production plants in central Vietnam to assess production capacity, evaluate their ability to supply E10 blending demand and identify obstacles facing the industry.

The delegation inspected both operating plants and facilities that have suspended production to review the country's E100 supply capacity ahead of the planned expansion of biofuel use.

Industry representatives said Vietnam currently has three operating E100 plants: the Dung Quat Biofuel Plant, the Quang Nam Ethanol Plant and the Dong Nai Ethanol Plant. Together, they have a combined design capacity of around 830 cubic metres a day, or approximately 277,000 cubic metres a year. In June alone, output exceeded 20,875 cubic metres, equivalent to nearly 84 per cent of monthly design capacity.

Producers said many of the plants have been operating for years, resulting in ageing equipment and increasingly frequent technical problems.

They also said demand remained unstable because sales were largely based on short-term contracts, while competition from imported ethanol made it difficult to plan production and long-term investment.

Representatives of Binh Son Refining and Petrochemical Joint Stock Company (BSR) proposed giving priority to domestically produced E100, improving producers' access to financing and introducing long-term off-take agreements between ethanol manufacturers and fuel distributors to provide stable demand.

Meanwhile, Do Van Tuan, chairman of the Vietnam Biofuels Association, called for the development of dedicated feedstock-growing areas and restrictions on cassava chip exports to encourage higher-value domestic processing and secure raw material supplies for ethanol production.

Concluding the meeting, Deputy Minister Nguyen Sinh Nhat Tan said expanding the use of E10 biofuel formed part of Vietnam's strategy to strengthen energy security and advance its green transition.

The Ministry of Industry and Trade said it would consolidate recommendations from businesses and work with other ministries to improve policies addressing financing, raw material supplies, product consumption and competition from imported ethanol.

The deputy minister also urged producers to review their production capacity, develop stable E100 supply chains from feedstock production to distribution, and strengthen cooperation with petroleum distributors to ensure sufficient supplies for the country's biofuel roadmap.