A lot is going on in the biofuels world, from new plants popping up across the United States and threatening to oversupply the market, to fresh anti-competition rules in Europe to audits on potentially fraudulent feedstocks.
First, in the European Union, a new provisional anti-dumping duty that took effect last Friday has Chinese biodiesel producers looking for new outlets in Asia for their exports and exploring other biofuels.
The provisional duties are being imposed on Chinese biodiesel after finding it was being sold into EU markets at unfairly low prices. The tariff is set to be between 12.8% and 36.4%.
This has smaller Chinese producers facing potential plant closures and larger firms looking at new options, including marine fuel markets at home and in Singapore.
In the United States, a new report released last week showed that renewable diesel and other emerging biofuel output capacity rose by 44% last year to 282,000 barrels per day (bpd). This comes as five new plants kicked off production last year.
The rush to add new renewable diesel facilities is forcing some biofuel producers out of the market. While renewable diesel can be a substitute for diesel, biodiesel can only be used for blending and has less attractive financial incentives.
Reuters reporters Shariq Khan and Nicole Jao did a great story on this in May that looked at the dynamics at play here, as well as some of the plant closures to hit the market. You can read that here.
Meanwhile, ethanol production capacity was up by about 2% to 1.18 million bpd, the Energy Information Administration said in a separate report released last week, with 187 plants in operation.
Finally, the U.S. Environmental Protection Agency has launched investigations into supply chains for at least two renewable fuel producers amid concerns that they are using fraudulent feedstocks for their biodiesel to secure valuable government subsidies, Leah Douglas reported this month.
Refiners can get subsidies by making biodiesel from sustainable ingredients, including used cooking oil. However, fears have mounted that some supplies labeled as cooking oil are virgin palm oil, which is actually cheaper and less sustainable as it is associated with deforestation and other environmental damage.
