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.
How we can help
Biodiesel news and market information products from ICIS
We offer the following regional Biodiesel analysis and news coverage to keep you informed of factors and developments affecting prices in the Biodiesel marketplace.
Price Reporting – More information about the price reports we publish on Biodiesel
Independent price assessments and market coverage by region
Price History – More information about the historical price data we publish on Biodiesel
Track historical price data
News & analysis
News & Analysis - News & market analysis specifically relating to Biodiesel
Breaking news of latest developments affecting the markets.
Insight and analysis of factors driving prices.
Biodiesel: Market overview
The outlook for biodiesel depends on the key benchmarked importing region Europe and remains uncertain. Participants have yet to ascertain how the European Commission’s antidumping duties (ADDs) on biodiesel imports from Indonesia and Argentina will affect the global supply/demand balance.
To counter the loss of its biggest consumer, the Argentine government announced in December that the blend rate for biodiesel with fuel and for use by power plants will increase to 10%. The current blend rate is 8%. The measure will absorb about 450,000 tonnes/year of biodiesel and would mean savings of about $50m, as it will offset expensive fuel imports, according to players in the sector.
The implementation of the increased blend rate in both the fuel pool and the electricity complex will allow about 33% of installed capacity to fulfil domestic Argentine demand, they said.
The ADDs have closed the door on imports to Europe, with little soybean methyl ester (SME) remaining in the market. However, sources expect domestic production of rapeseed methyl ester (RME) and palm methyl ester (PME) to increase. Meanwhile in Asia, increase in demand for PME in the first quarter of 2014 would come from the local blending mandates, instead of exports to Europe.
In the US, the outlook was still uncertain amid stagnant US Environmental Protection Agency (EPA) blending mandate proposals and doubt in the sector that the $1/gal federal tax credit will be renewed. Many players expect that US biodiesel production will shut down considering stagnant renewable fuel volume blending mandates in the US and the lack of the $1/gal tax credit in 2014.
Many market players do not expect the tax credit to be renewed, which is considered crucial to most producers. The tax credit expired on 31 December 2013.
While US biodiesel production in 2013 likely met Renewable Fuel Standard (RFS2) levels of 1.28bn gal (4.85bn litres) for the year, federally mandated production proposed levels looking to 2014 are steady with current mandates.
However, complicating the picture is that 20% of volumes produced in 2013 can be carried over to 2014, meaning that less production will be needed this year to meet renewable volume obligations (RVO).The comment period on the EPA's proposed 2014 RVO requirements ends on 28 January.
Updated to mid-Jan 2014
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).