Copyright 2014 Reed Business Information Limited. ICIS Pricing is a member of the Reed Elsevier plc group. 9th January 2014 Global Biodiesel Editors Heng Hui hui.heng@icis.com, Sarah Trinder sarah.trinder@icis.com, Leela Landress, Leela.Landress@icis.com EUROPE (SPOT) Click for Price History Price Range Four weeks ago EUR/MT RME EN14214 FOB NWE USD/TONNE -47 1062-1077 -69 1151-1186 781.96-793.00 RME (RED) FOB NWE USD/TONNE -52 1092-1107 -74 1176-1211 804.04-815.09 FAME 0 CFPP FOB ROTTERDAM USD/TONNE -27 1037-1052 -54 1081-1106 763.56-774.60 FAME 0 CFPP (RED) FOB ROTTERDAM USD/TONNE -32 1067-1082 -59 1106-1131 785.64-796.68 FAME -5 CFPP FOB ROTTERDAM USD/TONNE -27 1047-1062 -54 1091-1116 770.92-781.96 FAME -10 CFPP FOB ROTTERDAM USD/TONNE -57 1052-1067 -79 1141-1176 774.60-785.64 PME CIF ARA T2 USD/TONNE -17 1007-1022 -44 1056-1081 741.47-752.51 PME (RED) CIF ARA T2 USD/TONNE -22 1037-1052 -49 1081-1106 763.56-774.60 CIF ARA T2 USD/TONNE -27 1047-1062 -54 1076-1101 770.92-781.96 NOTE: for full details on the criteria ICIS pricing uses in making these price assessments visit www.icispricing.com and click on methodology. RME demand capped by high inventory Seasonal rapeseed methyl ester (RME) demand is lower-than-expected due to a healthy customer inventory generated by pre-buying in the fourth quarter of 2013. Coupled with plenty of offers in the market, the lower demand has exerted downward pressure on RME premiums over ICE Gasoil futures. RME has an advantageous cold filter plugging point (cfpp) which ensures it is in high demand during winter, but this has not been the case so far this year. Overall, European biodiesel premiums are on the decline due to healthy supply and poor demand, and dropping feedstock prices. It has been a slow start to the year, an industry source said. However, the number of biodiesel trades have increased from last week, albeit by a small margin, after a number of participants returned from the winter holidays. Market activity in the paper market accelerated over Tuesday and Wednesday, before falling back on Thursday. The increased activity mid-week indicated buyers were emerging from the sidelines to get a feel for the market, an industry source said. However, the majority of buyers are still likely to wait until they feel premiums have hit rock bottom before they close deals, it added. Meanwhile, supply is healthy because of good harvest in upstream virgin vegetable oils, a source said. The market outlook remains unclear at present because of uncertainty regarding feedstock pricing and demand levels, but sources expect a clearer picture to emerge in the coming weeks.
Page 2 of 5 Biodiesel premiums over ICE gasoil The daily settlements of front-month ICE gasoil were in a range of $907.25-912.25/tonne this week. The above ranges are calculated by adding biodiesel premiums to the gasoil range. Biodiesel grade Premium over ICE gasoil Last week's report Rapeseed methyl ester (RME) $155-165/tonne FOB NWE $185-190/tonne FOB NWE RME RED $185-195/tonne FOB NWE $220-225/tonne FOB NWE Fatty acid methyl ester (FAME) 0 $130-140/tonne FOB Rotterdam $140-150/tonne FOB Rotterdam FAME 0 RED $160-170/tonne FOB Rotterdam $175-185/tonne FOB Rotterdam FAME -5 $140-150/tonne FOB Rotterdam $150-160/tonne FOB Rotterdam FAME -10 $145-155/tonne FOB Rotterdam $185-190/tonne FOB Rotterdam Palm methyl ester (PME) $100-110/tonne CIF ARA $100-110/tonne CIF ARA PME RED $130-140/tonne CIF ARA $135-145/tonne CIF ARA Soybean methyl ester $140-150/tonne CIF ARA $150-160/tonne CIF ARA Feedstock Rapeseed oil 698/tonne FOB NWE February/April 2014 delivery 708/tonne FOB NWE May 2014/July 2014 delivery 698/tonne FOB NWE August 2014/October 2014 delivery Source: Reuters, 9 January. Covering Editor: Cuckoo James SOUTH AMERICA Click for Price History Price Range Four weeks ago
Page 3 of 5 FOB ROSARIO EXPORT USD/TONNE -10 840-855 -10 850.00-865.00 Argentina The Argentine government officially approved on Thursday the increase in the biodiesel blend percentage with diesel fuel and for use in power plants. The new blend percentage is 9%, up from 8%. The blend percentage for power plants was increased to 10%. The measure is expected to absorb about 450,000 tonnes/year of biodiesel and would mean savings of about $50m, as it will offset expensive fuel imports, a large regional producer said in December. According to resolution 1125/2013 the blend percentage with diesel will increase again in February to 10%. The legislation will increase the utilisation of installed capacity countrywide from 21% to 33%, the resolution said. Biodiesel prices were assessed lower this week, as crude soybean oil (SBO) prices have sagged in recent days. NORTH AMERICA (DOMESTIC) Click for Price History Price Range Four weeks ago USD/MT B100 FOB MIDWEST USD/GAL -0.75 3.14-3.24-0.75 3.99-4.09 829.50-855.92 B100 FOB USG USD/GAL -0.77 3.27-3.37-0.77 4.09-4.19 863.84-890.26 FAME 0 CFPP FOB MIDWEST USD/GAL -0.75 3.09-3.19-0.75 3.94-4.04 816.29-842.71 Biodiesel and Renewable Identification Numbers (RINs) Regional biodiesel producers reported pricing that has plummeted as the expiration of the $1/gal federal tax credit went into effect on 31 December 2013. Many players in the biodiesel sector do not expect the tax credit to be renewed. However, a recent new report quoted Iowa Senator Chuck Grassley saying that he expects the $1/gal federal tax credit to be extended for 2014. Amid such uncertainty in the market, a producer said production rates and business volumes were down across the sector. RINs were slightly lower as bids and offers for 2014 were at $0.31-0.33/RIN during the week, while 2015 RINs bids/offers were down at $0.42-0.44/RIN. BioHeat Legislation that would require all heating oil sold in the state of New York to contain at least 2% biodiesel fuel by July 2015 has reached the desk of the governor, Andrew Cuomo, who is expected to decide the fate of the legislation by the end of January. The bill was approved by the New York State Assembly and House in June. 2013. It would require that all heating oil all sold statewide would have to meet that standard by 2 July 2015. As the largest municipal consumer of heating oil nationwide, New York City implemented a citywide 2% biodiesel requirement in October 2012. US 80% biodiesel crude glycerine (bio-crude) US 80% crude glycerine (bio-crude) prices were assessed steady this week as published ranges were said to be representative of the market for medium-sized buyers. Large buyers, mostly in the animal feed sector are paying prices below the published range. Feedstocks Bleachable fancy tallow (BFT) in the Chicago cash markets was at 34 cents/lb on the 8 January close, steady from the previous week.
Crude SBO in the Chicago cash markets settled at 35.06. Last year SBO prices were much higher at 47.50 cents/lb. Page 4 of 5 ASIA (SPOT) Click for Price History Price Range Four weeks ago USD/CBM PME FOB S.E.Asia USD/TONNE -20 880-930 -20 950-1015 774.40-818.40 PME prices weaker on lower gasoil prices Prices of palm methyl ester (PME) in southeast Asia were assessed as weaker on the back of lower offers and buying ideas amid lower gasoil prices. A major producer said it was targeting at $900/tonne FOB SE Asia, citing low demand. Prices of both ICE gasoil, at $913.50/tonne, and palm oil dropped week on week. Malaysia s tax-free export status under the European Generalised Scheme of Preferences has ended on 31 December 2013. It now carries a 6.5% import duty. The export tax to US remains at 4.6%. Meanwhile, the January crude palm oil (CPO) price was at $767.40/tonne, which puts the price spread between gasoil and CPO at $146.10/tonne. A premium of at least $130/tonne is required to break even, according to a producer. By-product glycerine Prices of drummed refined glycerine were last assessed as stable at $900-950/tonne FOB SE Asia for the week ended 8 January. Feedstock Workable negotiation levels for co-feedstock methanol were heard at $570-590/tonne CFR SE Asia on 9 January. The Bursa Malaysia's CPO contract price was at ringgit (M$) 2,517.00/tonne for January 2014. Freight rates From southeast Asia to Europe: $80-90/tonne, 5,000-6,000 tonnes From southeast Asia to the US: around $100/tonne ($1 = M$3.28) Pricing information from ICIS is also available via the Dashboard service. The ICIS Dashboard is a platform that enables you to see pricing, news and analysis in a single screen. Visit http://www.icis.com/moreondashboard to find out more. FEEDSTOCKS (SPOT) Click for Price History Price Range GAS OIL FOB BARGES ARA USD/TONNE -5.00 905.25-906.75-5.00 Price history Related reports Full report list Price Alert Plant performance data Currency conversion (real time) Glossary Methodology Latest product news Find a supplier For information about multiple subscriptions and licences to this information product, or for permission to photocopy or redistribute individual reports, please call the relevant office: London:+44 20 8652 3335, sales.uk@icis.com Houston:+1 713 525 2600, sales.us@icis.com Singapore:+65 6789 8828, ICIS pricing accepts no liability for commercial decisions based on the content of this report. Copyright violation is a serious offence. Any distribution or forwarding of information which is not expressly permitted by your subscription agreement is a copyright violation. ICIS pricing will be using software to monitor unauthorised electronic redistribution of reports. Copyright 2014 Reed Business Information Limited. ICIS pricing is a member of the Reed Elsevier plc group. Customer Support Centre +44 20 8652 3335 or toll free from US/Canada:+1 888 525 3255 ICIS pricing:www.icispricing.com ICIS News:www.icis.com/news ICIS website:www.icis.com
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