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<br>By Chen Aizhu<br> |
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<br>SINGAPORE, Aug 16 (Reuters) - Chinese [biodiesel](https://www.energy-xprt.com/companies/mission-newenergy-limited-36048) producers are seeking new [outlets](https://www.sec.gov/Archives/edgar/data/1463471/000165495419013063/R31.htm) in Asia for their exports and checking out producing other biofuels as supply to the European Union, their [biggest](https://www.zoominfo.com/c/mission-newenergy/346542889) purchaser, dries up ahead of anti-dumping tariffs, [biofuel](https://stocktwits.com/symbol/MNEL) executives and analysts stated.<br> |
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<br>The EU will impose provisional anti-dumping duties of between 12.8% and 36.4% on Chinese [biodiesel](https://biodieselmagazine.com/articles/felda-global-buys-missions-kuantan-port-plant-for-11-5-million-9053) from Friday, hitting over 40 companies including [leading producers](https://www.proactiveinvestors.co.uk/companies/news/159346/mission-newenergy-delivers-maiden-biodiesel-production-to-global-oil-major-24476.html) Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export company that was worth $2.3 billion last year.<br> |
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<br>Some larger manufacturers are considering the marine fuel market in China and Singapore, the world's leading marine fuel hub, as they look for to offset currently falling biodiesel exports to the EU, [biofuel executives](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608) said.<br> |
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<br>Exports to the bloc have fallen sharply considering that mid-2023 amidst investigations. Volumes in the very first 6 months of this year plunged 51% from a year previously to 567,440 tons, Chinese customs data revealed.<br> |
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<br>June shipments diminished to just over 50,000 heaps, the most affordable because mid-2019, according to customs data.<br> |
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<br>At their peak, exports to the EU reached a record 1.8 million lots in 2023, representing 90% of all Chinese [biodiesel](https://www.zoominfo.com/c/mission-newenergy/346542889) exports that year. The Netherlands was the leading importer in 2023, soaking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese customs figures showed.<br> |
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<br>Chinese producers of biodiesel have enjoyed fat earnings recently, [maximizing](https://www.proactiveinvestors.co.uk/companies/news/159352/mission-newenergy-debt-free-focused-on-biofuel-joint-venture-60797.html) the EU's green energy policy that gives aids to companies that are utilizing biodiesel as a sustainable transportation fuel such as Repsol, Shell and Neste.<br> |
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<br>A number of China's [biodiesel](https://www.intelligentinvestor.com.au/shares/asx-mbt/mission-newenergy-limited/share-price) manufacturers are privately-run small plants utilizing ratings of workers processing waste oil collected from millions of Chinese dining [establishments](https://www.sec.gov/Archives/edgar/data/1463471/000165495419013063/R31.htm). Before the biodiesel export boom, they were making lower-value items like soaps and processing leather items.<br> |
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<br>However, the boom was temporary. The EU began in August last year examining Indonesian biodiesel that was thought of preventing responsibilities by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel believed to be priced artificially low and undercutting local producers.<br> |
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<br>Anticipating the tariffs, traders stockpiled on used cooking oil (UCO), lifting prices of the feedstock, while prices of biodiesel sank in view of shrinking need for the Chinese supply.<br> |
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<br>"With large rates of UCO partially supported by strong U.S. and European demand, and free-falling item prices, companies are having a bumpy ride surviving," said Gary Shan, chief marketing officer of Henan Junheng.<br> |
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<br>Prices of hydrotreated vegetable oil, or HVO, a main type of [biodiesel](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608), have actually cut in [half versus](https://www.investing.com/equities/mission-newenergy-ltd-company-profile) last year's average to the [existing](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608) $1,200 to $1,300 per metric ton and are off a peak of $3,000 in 2022, Shan included.<br> |
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<br>With low rates, [biodiesel](https://biodieselmagazine.com/articles/felda-global-buys-missions-kuantan-port-plant-for-11-5-million-9053) plants have cut their operations to an all-time low of under 20% of existing capacity on average in July, down from a peak of 50% last seen in early 2023, according to Chinese consultancies Sublime China Information and JLC.<br> |
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<br>Meanwhile, [diminishing biodiesel](https://pitchbook.com/profiles/company/51278-86) sales are improving China's UCO exports, which analysts predict are set to touch a brand-new high this year. UCO exports skyrocketed by two-thirds year-on-year in the first half of 2024 to 1.41 million tons, with the United States, [Singapore](https://www.proactiveinvestors.co.uk/companies/news/159346/mission-newenergy-delivers-maiden-biodiesel-production-to-global-oil-major-24476.html) and the Netherlands the leading locations.<br> |
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<br>OUTLETS<br> |
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<br>While numerous smaller sized plants are likely to shutter production forever, larger producers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring new outlets consisting of the marine fuel market at home and in the essential hub of Singapore, which is utilizing more [biodiesel](https://www.google.com/search?kgmid=/m/0cqd_rb) for ship fuel mixing, according to the [biofuel](https://stocktwits.com/symbol/MNEL) executives.<br> |
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<br>Among the producers, [Longyan](https://www.sec.gov/Archives/edgar/data/1463471/000165495419013063/R31.htm) Zhuoyue, concurred in January with COSCO Shipping to use more biodiesel in marine fuel.<br> |
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<br>Companies would likewise speed up planning and building of [sustainable aviation](https://www.google.com/search?kgmid=/m/0cqd_rb) fuel (SAF) plants, executives stated. China is anticipated to announce an SAF mandate before completion of 2024.<br> |
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<br>They have actually also been scouting for new outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are regional requireds for the alternative fuel, the officials included.<br> |
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<br>(Reporting by Chen Aizhu |
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