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 Q4 2019
Supply increased in Q4 2019 as producers in Malaysia and Indonesia ramped up production to meet local blending mandates, but there was reduced export material available to the EU and China due to the mandate requirements. Biodiesel producers in Thailand also increased production, but higher crude palm oil prices eventually led to higher production costs and higher export prices.
Demand in Q4 2019 increased in domestic markets as the governments in Indonesia, Malaysia and Thailand pushed for higher blending requirements to try and support CPO prices and reduce growing stockpiles. Demand from export markets reduced greatly due to lower requirements and due to unfavourable gasoil-palm oil spreads at times during the quarter when crude prices spiked.
European biodiesel supply levels were ample at the start of the fourth quarter. During the period, rapeseed methyl ester (RME) availability remained healthy. Fatty acid methyl ester 0 (FAME 0) stocks tightened towards the end of the quarter amid a drop in biodiesel imports from Argentina and Indonesia. Used cooking oil methyl ester (UCOME) availability was limited due to strong demand in preparation for the switch to RED II.
Demand for rapeseed methyl ester (RME) was at lower levels than expected during the fourth quarter. Winter is typically a period of high buying interest for RME due to its low cold filter plugging point (CFPP). Some players were thought to have bought material in the third quarter and stockpiled for the peak demand season in winter. FAME 0 demand grew at the end of the quarter as players began stockpiling for the summer.
US biodiesel supply decreased in the fourth quarter after producers hit the federal mandate on biodiesel volumes around late October against the backdrop of the lapsed $1/gal tax credit, putting increased financial pressure on producers to operate. Although it was announced at the end of the year that the tax credit would be retroactively reinstated from 2018 through 2022, production remained slow amid high renewable identification number (RIN) prices and feedstock costs.
US biodiesel demand decreased in the fourth quarter after producers surpassed the federal mandate on biodiesel volumes around late October, prompting buyers to reduce their volumes during the winter low season. Demand also decreased after renewable identification number (RIN) prices and feedstock costs surged on news the US government would retroactively reinstate the federal $1/gal tax credit on biodiesel production from 2018 through 2022. High prices disincentivised buying ahead of the 2020 mandate.
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.
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 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
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