27 September 2012 11:06 [Source: ICIS news]
LONDON (ICIS)--European spot refined vegetable glycerine prices have reached the highest level since 2008 on tight market conditions, according to ICIS data late on Wednesday.
Spot refined vegetable glycerine values increased to €790-840/tonne ($1,013-1,077/tonne) FD (free delivered) NWE (northwest Europe) on 26 September, up by €40/tonne, as many producers are sold out of product and unable to offer spot volumes.
Current values represent the highest price levels for refined vegetable glycerine seen since 11 June 2008, when values were at €850-950/tonne FD NWE.
The European refined vegetable glycerine market has experienced extremely tight conditions in recent weeks, with sources attributing this to low levels of rapeseed methyl ester (RME) production in Europe.
RME production creates kosher non-genetically modified organism crude glycerine as a by-product. This is then refined to become refined vegetable glycerine.
Winter tends to be the peak demand season for RME, due to its good performance in cold temperatures, and it is hoped that production will increase imminently.
However, many biodiesel blenders have already fulfilled their mandates through the use of used cooking oil methyl ester, which counts double towards EU blending targets as it is made from a waste residue.
This leads some sources to suggest that production of RME will be lower in the fourth quarter, compared to previous years, and that tight conditions in the refined vegetable glycerine market are likely to continue for the rest of 2012.
($1 = €0.78)
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