First Argus RED biodiesel swap trades
London, 13 July 2011
The first paper swap for rapeseed methyl ester (RME) has traded against the Argus Renewable Energy Directive (RED)-compliant physical biodiesel price series. Total bought the October swap from another oil major at a $550/t premium to Ice gasoil futures through brokerage TFS.
The swap will be settled against a new assessment that Argus will introduce on 3 October. Argus will introduce additional Rotterdam barge assessments for physical RME, FAME zero, PME, SME and FAME -10 accompanied with RED certification recognised by a European Commission-approved auditing body. Existing Argus physical RME, FAME zero, PME, SME and FAME -10 assessments will continue to reflect non-RED, oil industry standard sustainability trade in the northwest European and Mediterranean markets. Argus launched a RED-compliant T2 ethanol assessment on 1 July.
“We are pleased that the industry is already using our new assessments before their October launch,” Argus Media chairman and chief executive Adrian Binks said. “We work closely with the industry to ensure that our price assessments are appropriate, accurate and meet risk management and trading needs. Biofuels is a rapidly growing, sophisticated and intelligent market and we enjoy excellent relationships with the companies involved.”
Argus biodiesel assessments are used extensively in Europe as benchmarks for physical term and spot trade as well as for swap settlement.
The RED sets out stringent social and environmental sustainability requirements for the cultivation of biofuel feedstocks through to the production of biodiesel and ethanol. RED-compliant biofuel accreditation is gaining pace in EU member states, with the first pan-European RED auditing schemes expected to receive full European Commission accreditation this summer.
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Argus is a leading provider of price assessments, business intelligence and market data on the global crude, oil products, natural gas, electricity, coal, emissions and transportation industries. It is headquartered in London and has offices in Houston, Washington, New York, Portland, Calgary, Johannesburg, Dubai, Singapore, Tokyo, Beijing, Sydney, Moscow, Astana, Kiev, Santiago and other key centres of the energy industry. Argus was founded in 1970 and is a privately held UK-registered company. Learn more at www.argusmedia.com