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.
Updated to Q3 2020
Southeast Asian producers were mostly producing sufficient volumes to meet domestic consumption in Q3, which remained well supported by the respective southeast Asian governments. However, there were some concerns in Indonesia over the government’s ability to continue supporting the biodiesel blending programme near the end of Q3, due to the wide price gap between gasoil and palm oil.
There was no export demand in Q3 as the palm oil-gasoil (POGO) price spread did not narrow sufficiently for blending to be viable. Feedstock crude palm oil (CPO) price trend was bullish, while gasoil prices never recovered to levels last seen before the crude price crash earlier this year. Buying interest was further diminished by the close of the quarter as overseas markets switched from the summer diesel blends to the winter blends.
Biodiesel supply began to increase from July onwards as the market consumed stored volumes accumulated through the peak pandemic months. A complete halt of PME imports from Asia and SME imports from Argentina culminated in FAME 0 shortages by September. Production was diverted to the FAME-10 and RME after France announced a 20% tax rebate for the winter grades. Availability of rapeseed-based biodiesel remained ample by the end of Q3.
Demand for FAME 0 remained healthy across Europe due to its summer blend properties. Buying interest for FAME-10 and RME gained some traction by the end of the quarter. Spot interest for all grades of biodiesel waned for the entire month of September as market activities stalled. A static gasoil market also hindered spot trades. Demand for UCOME fared better than other biodiesel grades until it too slowed down by the end of Q3.
Production increased as producers ramped up during the summer high season. Production is typically strongest during the North American summer. Production also increased following lower-than-usual production in Q2 stemming from the onset of the coronavirus. Biodiesel production has not fallen as much as production for other fuels this year, supported by the federal mandate on consumption and sustained demand for diesel fuels for trucking during the pandemic.
Demand increased in Q3 amid increased diesel consumption during the summer higher season. Demand increased to meet the federal mandate on biodiesel consumption. Demand also increased following weaker fuels demand in Q2 because of the onset of the coronavirus pandemic. Demand also increased as movement restrictions related to the pandemic were lifted. Sustained diesel demand for trucking during the pandemic also supported consumption.
We offer the following regional Biodiesel analysis and news coverage to keep you informed of factors and developments affecting prices in the Biodiesel marketplace.
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.
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Biodiesel is the name of a clean burning alternative fuel, produced from renewable resources. The most commonly used feedstocks are rapeseed, soy and palm oil.
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).
Rapeseed oil, fats and grease, crude palm oil