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France requires 60pc GHG from ex-EU biodiesel imports

02 Jan 2018 15:14 GMT
France requires 60pc GHG from ex-EU biodiesel imports

London, 2 January (Argus) — French biodiesel imports from outside the EU must have a minimum 60pc greenhouse gas (GHG) savings value from 1 January — a measure that could have considerable impact on trade flows from Argentina.

The law, thought to be an attempt to protect French biodiesel production from swelling Argentinian soy methyl ester (SME) imports, applies to plants that began operating outside the EU from January 2008. The majority of Argentina's biodiesel production became operational after that time and default GHG value of its SME falls short of the new requirement.

Around 387,000t of Argentinian SME was scheduled for export to Europe in November-December 2017, some of which is expected to arrive this month. A significant portion of the Argentinian SME sent to Europe in recent months has made its way to France after being received in the Netherlands and Spain.

The very short implementation period means market participants are still seeking clarification on certain aspects of the measure and its effect on trade — for example, whether product with less than 60pc GHG savings can be blended with higher GHG product to gain a 60pc average before being imported.

SME from Argentina can reach 60pc GHG or above, but some say this is down to the mixture of real and default values applied throughout the production chain. Sustainability certification scheme ISCC and the European Commission are likely to clarify whether the mix of default or real GHG values is possible under renewable energy directive (RED) regulation.

The minimum GHG value for EU-produced product sent to France is 50pc for any facilities commissioned before 5 October 2015 and 60pc for facilities commissioned after that date.