03 May 2012 21:32 [Source: ICIS news]
MEDELLIN, Colombia (ICIS)--Argentina’s soy methyl ester (SME) biodiesel market was described as dead this week in the wake of Spain’s move to limit imports from the South American country, market players said on Thursday.
The SME bid/offer range FOB (free on board) at the Argentine port of Rosario was assessed lower by $52/tonne (€40/tonne) on bids/offers heard late last week.
The SME range for export material was assessed by ICIS at $1,179-1,199/tonne FOB Rosario.
One seller said it had not even heard any quotes this week for May, June or July, and that the market would be even more subdued than usual due to the national holiday early this week.
The general consensus among sources was that this market would take a while to recover and reactivate following Spain’s retaliation against Argentina on 20 April with a measure to curtail Argentine biodiesel imports following the expropriation of YPF from Spain’s Repsol.
Most of the biodiesel used in Spain is imported, with much of the imports coming from Argentina.
In order to absorb more product domestically, Argentina plans to gradually increase the biodiesel blending requirement in diesel fuel. The government plans to increase blending requirements to 10% from the current 7% between May and October by increasing requirements by 0.5% each month.
There was talk this week that the Argentine government plans to increase the biodiesel blending requirement in heavy equipment, specifically in transport and agricultural use sectors, to 20%.
Calls to the Argentine Secretary of Energy for confirmation were not returned.
The Argentina House of Representatives on Thursday was debating a bill sent by President Cristina Fernandez de Kirchner for the government to obtain a 51% stake in YPF, effectively expropriating the company.
($1 = 0.76)
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