Biodiesel Prices, markets & analysis
ICIS provides independent and unbiased pricing information, news and market analysis for the global biodiesel market. Our network of price reporters based in Asia, Europe and the US deliver local insight for each of these markets, which is published in our global weekly report.
If you buy or sell biodiesel or related products, our report, news and market intelligence will give you the prices and analysis of the factors driving the markets. This will give you confidence in making commercial decisions.
Global biodiesel prices are also available via FTP.
Our editor gives their expert view
Biodiesel Overview Transcript
In the US biodiesel is an emerging market. It was reduced to about 10% of its production capacity, as the Federal tax credit disappeared and has now reappeared.
With the reappearance of that, biodiesel is beginning to find its footing in the US market.
The material is highly dependent on the crude oil markets, it’s traded at a premium to heating oil, the spread on heating oil sets the prices for biodiesel that is, being looked at for basis on trading on spot market. There are no contracts in the US biodiesel markets at this time.
The market is also dependent on the crude-glycerine co-product and that material is also watched very closely for its availability for sales.
Most of the biodiesel in the US right now is traded at a premium, a spread to heating oil. The heating oil market, that has been the most successful area for domestic biodiesel sales as a blendstock it’s still finding its feet. It’s coming back into viability on the back of a reinstatement of the Federal tax credit $1/gal blender credit.
It’ll offer the players in the market more opportunity to find domestic sales for the product.
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Biodiesel: Market overview
Updated to Q3 2015
European biodiesel supply is set to remain tight until the new rapeseed crop hits the market in the coming weeks. Supply of the old crop is tight, affecting rapeseed methyl ester (RME) and fatty acid methyl ester (FAME) 0 availability. Unless palm methyl ester (PME) supply in Europe increases, RME and FAME 0 are likely to trade at close to parity, with RME remaining the main blendstock for FAME 0 blends.
Producers in southeast Asia’s PME market will continue to benefit from the supply tightness in Europe. According to a seller, 30,000-40,000 tonnes of PME are expected to be loaded from Malaysian ports to Europe in July. Some sources said that the figure might include spot as well as some contractual cargoes.
In the US, the US Environmental Protection Agency (EPA) announced in May the proposed volume requirements under the Renewable Fuel Standard (RFS) programme for the years 2014, 2015 and 2016, and proposed volume requirements for biomass-based diesel for 2017. The blend mandate is considered to be critical by most biodiesel producers. The EPA proposal, which is expected to be finalised in November this year, would gradually raise biodiesel volumes by about 100m gal/year to 1.9bn gal in 2017.
In Latin America, Argentine biodiesel production disappeared from the market at the end of 2014 and will not likely resume until crude oil prices see some improvement.
News & analysis
Biodiesel news & analysis
ICIS price assessments are based on information gathered from a wide cross-section of the market, comprising consumers, producers, traders and distributors from more than 250 reporters world-wide. Confirmed deals, verified by both buyer and seller, provide the foundation of our price assessments.
Our in-depth market knowledge drives our specialist focus, as we recognise the importance of individual market dynamics and not a one-size-fits-all approach.
Over 25 years of reporting on key chemicals markets, including Biodiesel, has brought global recognition of our methodology as being unbiased, authoritative and rigorous in preserving our editorial integrity. Our global network of reporters in Houston, London, Singapore, Shanghai, Guangzhou, Mumbai, Perth and Moscow ensures unrivalled coverage of established and emerging markets.
Biodiesel is a clean burning alternative fuel, produced from renewable resources. The most commonly used feedstocks are rapeseed, soy and palm oil. Corn and tallow are also used. Rapeseed methyl ester (RME) is mainly produced in Europe; soy methyl ester (SME) comes mainly from the Americas; and palm methyl ester (PME) from Asia, in particular Malaysia and Indonesia.
Biodiesel is made through a chemical process called transesterification to make the methyl ester with glycerine and is produced as a by-product.
Biodiesel can be used in compression-ignition (diesel) engines and most oil-fired boilers. It is suitable for most applications where regular diesel is currently used. It can also be used in most modern diesel engines without modification, including those in passenger cars, sport utility vehicles, light trucks, buses, ships, trains, off-road heavy equipment and mining equipment, as well as for home heating fuel, power generation and in two-stroke engines (as a mixing agent).