ICIS' Global Biodiesel price report contains news and analysis of market movements around the world. Our price assessments focus on European spot, South America, North America domestic and Asia spot.
The commentary highlights the influencing factors driving prices, and includes feedstock prices and graphs to reflect changing prices in this weekly report. Whether you are directly buying or selling on the biodiesel or related markets, this informative report will help you to make confident business decisions.
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Biodiesel: Market overview
Updated to Q2 2018
Despite EU removal of antidumping duties on Indonesian biodiesel, uncertainty persists as the European biodiesel industry persists in efforts to challenge lower-cost palm-biodiesel shipments into the EU. Malaysian biodiesel producers continue to hope for a B10 blending mandate to boost domestic consumption in current year.
The EU is expected to remain the biggest export market for Malaysian biodiesel while Indonesian biodiesel could see increased demand due to removal of antidumping duties. But uncertainty persists especially with the EU market seen as sufficiently supplied after a recent uptick in SME biodiesel imports from Argentina.
Market players expect European rapeseed methyl ester (RME) availability to tighten further in the second quarter, amid continued production cuts. Several players have announced closures or scaled back biodiesel production in the second quarter, with at least one plant confirmed to be closing temporarily while another company has confirmed its biodiesel production will be reduced to around 50-55% of total capacity.
Demand is set to continue tumbling as the summer months approach, with rapeseed methyl ester (RME) buying interest typically lower in the second quarter.
This is compounded this year by an abundance of palm methyl ester (PME) from Indonesia and soybean methyl ester (SME) from Argentina in the European market, following the removal of antidumping duties on material from both countries within six months of each other.
Biodiesel supply is expected to increase slowly in the second quarter unless federally mandated blending volumes are changed by the federal government. This would be a major upset to the US domestic biodiesel markets and would upend production. Lobbyists for the biodiesel sector and for petroleum refiners are in Washington arguing their cases.
If the federally mandated blend volumes are not changed, then demand will increase slowly over the quarter. If the previously agreed volumes are somehow changed by the Trump administration, then demand will disappear.
Argentine biodiesel producers are expected to run at about 52-55% of installed capacity and continue to send large volumes of SME to Europe until the trade window closes on further trade fight lawsuits.
Argentine SME production will continue to replace European-sourced biodiesel as long as trade tariffs remain reduced. This does not necessarily represent an increase in demand but rather increasing market share for the Argentines.
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).