21 September 2012 09:35 [Source: ICIS news]
By Heng Hui
PME is a type of biodiesel that is mostly produced in Asian countries such as
In late August, the European Commission launched the investigation to check whether fatty acid methyl ester (FAME) from
The probe, which also covers soybean methyl ester originating in
PME is used in a blend to make fatty acid methyl ester (FAME). Oil blenders substitute a small percentage of diesel with biodiesel according to each country’s stipulated regulations.
“No trade nowadays because of weak demand and [the antidumping] investigations,” said an Indonesian PME producer.
Biodiesel consumption is strong in
From Mediterranean countries, buying interest has been weak for Indonesian PME, which solidifies fast at low temperature and is not suitable for use during winter.
With PME ceasing to be traded, Asian producers have switched to winter biodiesel blends such as rapeseed methyl ester with a small percentage of soybean methyl ester from mid-September.
Indonesian producers can sell biodiesel at lower prices given a domestic abundance in raw material palm oil, on which a high export tax applies. The high duty on palm oil exports prompt Indonesian biodiesel producers to process the raw material and then ship out its derivative products, market participants said.
An expected decline in demand, together with falling prices of palm oil has kept trade subdued this week.
Spot PME prices declined by $30-40/tonne at $1,030-1,060/tonne (€793-816/tonne) FOB SE Asia on 20 September, according to ICIS. The assessment represents the export PME prices of
Price movement of diesel or gas oil also exerts an influence on the PME market. PME must be priced lower than diesel this week for biodiesel blending economics to work.
But based on current PME offers, the material is priced at premiums of $180-190/tonne to diesel.
A major PME seller, who exports material from
On 20 September, gas oil for October delivery closed at $950.25/tonne at the Intercontinental Exchange (ICE).
Southeast Asian PME producers include Singapore-based Wilmar International and Musim Mas
($1 = €0.77)
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