Biodiesel

BIODIESEL

Biodiesel is the name of a clean burning alternative fuel, produced from renewable resources such as vegetable oils, rape seed, soya and palm oil. Biodiesel contains no petroleum, but it can be blended at any level with petroleum diesel to create a biodiesel blend. Biodiesel is simple to use, biodegradable, non-toxic, and essentially free of sulphur and aromatics.

Biodiesel is made through a chemical process called transesterification whereby the glycerine is separated from the fat or vegetable oil. The process leaves behind two products – methyl esters (the chemical name for biodiesel) and glycerine (a valuable by product usually sold to be used in soaps and other products).  

Biodiesel can be used as a pure fuel or blended with petroleum in any percentage. In France, 5% biodiesel is common, and this has also been introduced in the UK. Vehicle manufacturers’ warranties cover use with 5% biodiesel blends. 100% biodiesel must meet EU quality standard EN 14214.

The European Union has set the goal of 2% use of biodiesel in 2005 with an increase of 0.75% per annum to 5.75% in 2010.  Production is expected to triple due to EU requirements, with some member states adopting mandates earlier.  The country with the highest capacity is Germany, followed by France, Italy and Austria.

Asian biodiesel is made mostly from palm oil and is called Palm Methyl Ester (PME). Palm oil producing countries like Malaysia and Indonesia are the main Asian biodiesel producers.

The use of biodiesel has various environmental benefits. Tests have shown that the toxicity of biodiesel is lower than that of petroleum-based diesel, and that in the environment it degrades more readily.

In terms of storage, handling and distribution, biodiesel is as safe as diesel, and it has a much higher ignition point. Biodiesel can be safely stored without degrading for up to six months, to keep for longer than that stabilising additives are needed.

ICIS pricing quotes Biodiesel in Europe, Asia and in the US.

Frequency:

Published weekly on Wednesdays in Europe and on Thursdays in the US.

 

Biodiesel (EUROPE)

Weekly Price Assessments:

Spot prices

• RME EN14214 FOB NWE (USD/MT)
• FAME 0 CFPP FOB ROTTERDAM (USD/MT)
• FAME -5 CFPP FOB ROTTERDAM (USD/MT)

 

Biodiesel (ASIA)

Weekly Price Assessments

Spot prices

• PME FOB Asia USD/MT (converted to USD/CBM)

 

Biodiesel (US)

Weekly Price Assessments:

Domestic spot prices in bid/offers

• B100 FOB Midwest (USD/GAL)
• B100 FOB USG (USD/GAL)  

 

General Information:

Assessment window: Price assessments are based on information supplied by market participants through the week up to close of business on Wednesday at 1700 hours in London, Houston and Singapore.

Specifications: ICIS pricing assesses rapeseed methyl ester (RME) biodiesel according to international standard EN14214. Vegetable methyl ester (PME) and fat methyl ester (FME) prices are discussed in the text of the report. In the US, there are no industry-wide standards applied to biodiesel traded. ICIS pricing quotes B100 of any feedstock.

Timing: Cargoes loading or delivered within 4-6 weeks from the date of publication.

Terms: 30-60 days after the bill of lading.

 

Standard cargo size: Typically cargo sizes are 1,000-3,000 tonnes in Europe, while in Asia export cargo sizes are typically 2,000-8,000 tonnes. In the US, biodiesel is generally shipped via standard tank trucks of 45,000 lb or rail cars of 180,000 to 190,000 lb.

 

Assessment basis: The reports contain market commentary and analysis including details of traced spot transactions, supply/demand issues, export/import information news when applicable, spot prices, contract price negotiations and general sentiment for price direction. In Europe, the price quotes reflect spot transactions for RME biodiesel in euros per cubic metre, usually concluded on a FOB NWE basis. The report offers price information and market trends on FME and PME grade biodiesel. Where applicable there is product information, production news, feedstock prices, comments on upstream and downstream market developments and general market intelligence including comments on European Union and individual state legislation relating to biodiesel and biofuels. In the US, prices reflect quotes for B100 truck and rail cargoes in generalised areas of the US midwestern states and in Texas for soy methyl esters (SME). In both Europe and the US, the price quotes captures mostly spot parcels and parcels on offer for export.

In Asia, most plants sell on European EN 14214 specifications to European buyers and to some in the US. Most companies.  Within Asia, the absence of mandatory regulations on biofuels means very little biodiesel is used, although small amounts are consumed in countries like Philippines, Thailand and Indonesia.

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