EU-27 biodiesel imports rise in April to meet demand
18.06.2020 (Argus Media) - Imports of biodiesel to the EU-27 rose in April from March, supported by strong prompt demand in the physical fob ARA market following spot price declines caused by Covid-19 lockdowns.
Imports of fatty acid methyl ester (Fame) attributed to a specific non-EU partner country rose by 6pc to 245,000t, but were 39pc lower on the year. Half of April's arrivals came from Argentina, according to provisional Eurostat data. The Netherlands was the largest importer with 114,000t of Fame, mainly from China, Malaysia and Argentina. Belgium imported around 34,000t, nearly all from Argentina.
Imports of biodiesel from Indonesia, historically one of the largest suppliers of palm oil-based biodiesel (PME) to the EU, fell to 9,000t in April from 16,000t in March. The Indonesian government revoked several producers' export licenses in an effort to direct product to the domestic market, in an effort to comply with the national 30pc fuel blending mandate introduced early in the year.
Increased imports of biodiesel from outside the EU-27 helped meet strong demand for Fame biodiesel in ARA, where trading of northwest European benchmark biodiesel grade Fame 0°C CFPP (Fame 0) hit a record high in April. This followed record futures trading for the grade in March, caused by participants seeking manage risk exposure as European diesel demand fell.
Fame 0 prices at the end of March hit the lowest since Argus began assessing the grade in 2011, but then physical liquidity picked up significantly. Much of the product bought in April is likely to have gone into storage. Prompt values have been supported more recently, as limited biodiesel production in the EU — where several producers reduced output because of the thin demand at the peak of the pandemic lockdowns — coupled with a decline in imports from Argentina and southeast Asia. Fame 0 prices rose by nearly $190/t in the 1 May-17 June period.
By Giulia Squadrin