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Add 'China's Biodiesel Producers Seek Brand-new Outlets As Hefty EU Tariffs Bite'

Roland Bosch 2025-01-13 03:39:45 -06:00
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China%27s-Biodiesel-Producers-Seek-Brand-new-Outlets-As-Hefty-EU-Tariffs-Bite.md Normal file

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<br>By Chen Aizhu<br>
<br>SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel manufacturers are looking for [brand-new outlets](https://forest500.org/rankings/companies/mission-newenergy-limited) in Asia for their exports and checking out producing other biofuels as supply to the European Union, their most significant purchaser, dries up ahead of anti-dumping tariffs, [biofuel](https://www.proactiveinvestors.com.au/ASX:MBT/Mission-NewEnergy-Ltd) executives and analysts said.<br>
<br>The EU will impose provisionary anti-dumping duties of between 12.8% and 36.4% on Chinese biodiesel from Friday, striking over 40 business consisting of leading producers Zhejiang Jiaao, Henan Junheng and [Longyan](https://forest500.org/rankings/companies/mission-newenergy-limited) [Zhuoyue](https://www.bloomberg.com/profile/company/MNELF:US) Group in an export organization that was worth $2.3 billion in 2015.<br>
<br>Some [bigger manufacturers](https://www.pinterest.com.au/missionnewenergy/) are eyeing the [marine fuel](https://www.investing.com/equities/mission-newenergy-ltd-company-profile) market in China and Singapore, the world's leading marine fuel center, as they seek to offset already [falling biodiesel](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608) [exports](https://www.proactiveinvestors.com.au/ASX:MBT/Mission-NewEnergy-Ltd) to the EU, [biofuel](https://stocktwits.com/symbol/MNEL) executives said.<br>
<br>Exports to the bloc have actually fallen greatly since mid-2023 [amidst examinations](https://www.abnnewswire.net/companies/en/31347/%E0%B8%9A%E0%B8%A3%E0%B8%B4%E0%B8%A9%E0%B8%B1%E0%B8%97-Mission-NewEnergy-%E0%B8%88%E0%B8%B3%E0%B8%81%E0%B8%B1%E0%B8%94.html/4). Volumes in the first six months of this year plunged 51% from a year earlier to 567,440 heaps, Chinese customs data revealed.<br>
<br>June [deliveries diminished](https://www.zoominfo.com/c/mission-newenergy/346542889) to simply over 50,000 tons, the most affordable given that mid-2019, according to customizeds information.<br>
<br>At their peak, exports to the EU reached a record 1.8 million tons in 2023, representing 90% of all [Chinese](https://www.intelligentinvestor.com.au/shares/asx-mbt/mission-newenergy-limited/share-price) [biodiesel](https://www.zonebourse.com/cours/action/MISSION-NEWENERGY-LIMITED-8557641/) exports that year. The Netherlands was the leading importer in 2023, taking in 84% of China's biodiesel shipments to the EU, followed by [Belgium](https://www.pinterest.com.au/missionnewenergy/) and Spain, Chinese customizeds figures showed.<br>
<br>Chinese manufacturers of biodiesel have enjoyed fat earnings over the last few years, making the many of the EU's green energy policy that gives subsidies to business that are using biodiesel as a sustainable transportation fuel such as Repsol, Shell and Neste.<br>
<br>A lot of China's biodiesel manufacturers are privately-run little plants employing scores of employees processing [waste oil](https://www.investing.com/equities/mission-newenergy-ltd-company-profile) collected from of Chinese restaurants. Before the biodiesel export boom, they were making lower-value goods like soaps and processing leather items.<br>
<br>However, the boom was short-term. The EU started in August last year examining Indonesian biodiesel that was presumed of preventing duties by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel thought to be priced artificially low and undercutting local manufacturers.<br>
<br>Anticipating the tariffs, traders stockpiled on utilized cooking oil (UCO), lifting rates of the feedstock, while rates of [biodiesel](https://biodieselmagazine.com/articles/felda-global-buys-missions-kuantan-port-plant-for-11-5-million-9053) sank in view of shrinking demand for the Chinese supply.<br>
<br>"With substantial costs of UCO partly supported by strong U.S. and European demand, and free-falling product rates, business are having a difficult time surviving," said Gary Shan, chief marketing officer of Henan Junheng.<br>
<br>Prices of hydrotreated veggie oil, or HVO, a primary kind of biodiesel, have cut in half versus last year's average to the current $1,200 to $1,300 per metric load and are off a peak of $3,000 in 2022, Shan included.<br>
<br>With low rates, biodiesel plants have actually cut their operations to an all-time low of under 20% of existing capability on average in July, below a peak of 50% last seen in early 2023, according to Chinese consultancies Sublime China Information and JLC.<br>
<br>Meanwhile, diminishing biodiesel sales are improving China's UCO exports, which analysts anticipate are set to touch a new high this year. UCO exports skyrocketed by [two-thirds year-on-year](https://www.zonebourse.com/cours/action/MISSION-NEWENERGY-LIMITED-8557641/) in the first half of 2024 to 1.41 million heaps, with the United States, Singapore and the Netherlands the leading locations.<br>
<br>OUTLETS<br>
<br>While numerous smaller plants are most likely to shutter production indefinitely, larger producers like Zhejiang Jiaao, [Leoking Enviro](https://www.intelligentinvestor.com.au/shares/asx-mbt/mission-newenergy-limited/share-price) Group and Longyan Zhuoyue are exploring brand-new outlets including the marine fuel market at home and in the crucial hub of Singapore, which is utilizing more biodiesel for ship fuel mixing, according to the [biofuel](https://www.intelligentinvestor.com.au/shares/asx-mbt/mission-newenergy-limited/share-price) executives.<br>
<br>Among the manufacturers, Longyan Zhuoyue, concurred in January with COSCO Shipping to utilize more biodiesel in marine fuel.<br>
<br>Companies would also accelerate preparation and structure of [sustainable aviation](https://forest500.org/rankings/companies/mission-newenergy-limited) fuel (SAF) plants, executives said. China is expected to announce an SAF mandate before the end of 2024.<br>
<br>They have actually likewise been searching for brand-new biodiesel customers outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are local mandates for the [alternative](https://www.proactiveinvestors.co.uk/companies/news/159346/mission-newenergy-delivers-maiden-biodiesel-production-to-global-oil-major-24476.html) fuel, the officials added.<br>
<br>(Reporting by Chen Aizhu