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Q&A: Waste-based biofuel to benefit Dutch bunkering

  • : Biofuels, Oil products
  • 25/01/15

With marine fuel greenhouse gas (GHG) emissions regulations tightening, shipowners are looking for financially feasible biofuel options. Argus spoke with Leonidas Kanonis, director for communications and analysis at European waste-based and advanced biofuels association (Ewaba), about biofuels for bunkering. Edited highlights follow.

Do you think that the Netherlands government will scrap the HBE-G bio-tickets that it has been allocating for marine fuel for use by ocean-going vessels?

HBEs are not disappearing in 2025, and the Dutch system will continue as normal, including HBE-G bio tickets. In 2026, the plan is that HBEs will be scrapped altogether, when the Dutch system switches to an Emissions Reduction Obligation.

The Emissions Reduction Obligation would be a transposition of the Renewable Energy Directive (REDIII) spanning all transport sectors and HBEs would not exist under such a system.

Annex IX of REDIII lists sustainable biofuel feedstocks for advanced biofuels (Part A) and waste-based biofuels (Part B).

Under the proposed REDIII, EWABA is advocating those fuels made from feedstocks listed under Annex IX B, which include used cooking oil and animal fat, be allowed into the sustainability criteria for maritime transport. Allowing only "advanced" feedstocks listed under Annex IX A would put the Dutch bunkering sector at a cost-and-supply disadvantage compared with non-EU ports.

The Annex IX B exclusion could also put the Netherlands in danger of not hitting its maritime sector target, which rises from a 3.6pc reduction in GHGs in 2026 to 8.2pc in 2030. Annex IX B biodiesel can bridge the gap while advanced technologies such as ammonia and hydrogen are more widely deployed.

The EU imposed anti-dumping taxes on Chinese biodiesel imports in mid-August. What has been the effect on European biodiesel producers?

Following the Chinese anti-dumping duties (ADDs), we have seen an uptick in domestic European waste-based biodiesel prices, widening the spread between the end product and the European domestic feedstock itself. On the other hand, on 1 December, the Chinese government cancelled the export tax rebate for used cooking oil (UCO), disincentivizing Chinese exporters and making Chinese UCO more expensive for European buyers.

It is still early to say what the trend for 2025 will be, but as an industry we are optimistic about increased European biodiesel production. Over the past two years, our members have been suffering, mostly operating at sub-optimal production levels or forced to shut down production. In 2025, there is reserved optimism that the market will improve due to: the ADDs to Chinese biodiesel, the 2025 FuelEU maritime regulation, and the introduction of the EU Database for Biofuels introduced in 2024, which tracks the lifecycle of biofuels and strengthens transparency.

Are there other threats next year that are facing the European waste-based and advanced biofuels producers?

Overall challenges for the market would be demand for feedstock from competing industries, largely the sustainable aviation fuel (SAF) market with the introduction of the ReFuelEU mandate, but also competing regions as the US imported huge amounts of waste feedstocks from China last year, while southeast Asian and UAE countries promote their own bio-blending targets.

Do you think Donald Trump's presidency would affect Europe's biofuel markets?

We expect the Trump administration to possibly limit feedstock imports from outside the US, boosting the sales of local soybean and other crop feedstocks to produce domestic HVO, SAF and biodiesel.

At the same time, the US government has noted they will impose duties on imports coming from anywhere, with China experiencing the most considerable level of duties of up to 60pc. For example, an import tax on European and UK biodiesel would mean that more fuel is available to fulfill the European and UK mandates, as the US is also relying on HVO and FAME from Europe and the UK to fulfill its own mandates.

Biofuel for bunkering has been a popular low-carbon fuel option among container ship companies. But oil tanker owners and dry bulk carrier owners are slower to embrace biofuels. Do you see this changing?

At the moment, most biofuels used in shipping are indeed for container ship companies that could more easily afford higher prices of bio components.

The biofuels industry is receiving a lot of interest from tanker or carrier owners but for lower biofuel blends compared to container ship companies. Container vessels are willing to buy higher biofuel blends and are interested in B100. Oil tankers are focusing more on B15 and higher bio blends to comply with the minimum GHG reduction targets possible. But as the GHG reduction targets on the FuelEU rise, this will of course change as well.

In 2030, what do you project will be the demand for biofuels for bunkering in Europe?

As an estimation, we expect waste biofuels bunkering demand in Europe to surpass 2-2.5mn tons by 2030.

Specification-wise, what are some of biofuel properties that ship owners need to look out for?

We don't believe waste-based and advanced biodiesel fuel properties have considerable issues for ship operators.

Especially for blends up to B30, there is nothing to worry about. For higher blends, viscosity and stability are the ones that I believe are more important. Storage time is also important to consider due to lower oxidative stability of FAME compared with fossil diesel alternatives that could be stored longer term.


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25/02/06

Crude Summit: Asset-backed oil trades on the rise

Crude Summit: Asset-backed oil trades on the rise

Houston, 6 February (Argus) — Asset-backed trading is becoming commonplace in the oil industry as companies up and down the supply chain bring capabilities in-house, delegates heard at the Argus Global Crude Summit Americas in Houston, Texas, today. "Traditionally, long term hedging was popular, and it still is, but in general we've seen a move towards the front end of the curve," said CME Group's managing director and global head of energy and environmental products Peter Keavey. "The risks are really in the prompt," said Keavy. "We're seeing a lot of hedging in the short term [and] that also is reflective of asset-based optimization." HC Group managing partner Paul Chapman has also noticed a continued shift in trading by banks, which either exited or scaled down operations in 2014 and 2015, to those directly in the industry. "I would argue that pretty much every single business around the world — producer, miner, refiner, retailer of fuels and major — is on some spectrum of developing some asset trading," said Chapman. "And it's driven by a need to capture more margin." Changing trade flows have naturally had a bearing on who becomes more involved in individual markets. "Over the past five years, European players have more and more exposure to US molecules, whether it be crude oil or natural gas," said Keavey, which has driven the growth of trade of WTI, RBOB, gasoline, and heating oil in international markets. Changing energy policy, and policies to reach other political objectives, have a tendency to shape energy flows, whether they are intended or not, the speakers said. The Russian-Ukraine conflict is a prime example, and there are clear signs that US president Donald Trump's second term in office will do the same. "As this world gets more shaped by trade wars and there's more and more government intervention, that itself starts to break down some of the fundamentals of how some of these markets work," said Chapman. Keavey expects Canadian crude to continue to flow even under a Canada-US trade war, but "the question is, what disruption happens to the pricing?" By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexico factory activity weakens in Jan


25/02/06
25/02/06

Mexico factory activity weakens in Jan

Mexico City, 6 February (Argus) — Mexico's manufacturing sector contracted further in January, according to the latest purchasing managers index (PMI) survey from the finance executive association IMEF. Both manufacturing and non-manufacturing PMIs decreased for a second month in January, falling deeper into contraction territory. "Mexico's economy began 2025 with no growth at all," said IMEF, "with the outlook made highly uncertain moving forward by US President Donald Trump's first actions in office." While Trump's proposed tariffs remain on hold, IMEF warned they could severely impact Mexico's economy by further stalling growth and triggering inflation. The manufacturing PMI dropped to 45.6 from 47.5 in December, marking its tenth consecutive month below the 50-point expansion threshold. Manufacturing, which accounts for about a fifth of Mexico's economy, is led by the auto sector, contributing about 18pc of manufacturing GDP. Within the manufacturing PMI, the new orders index dropped 3.5 points to 42.9 and deeper into contraction. Similarly, production fell 3.0 points to 42.8. Employment held at 47.4 in January, now in contraction for 12 consecutive months. The non-manufacturing PMI — covering services and commerce — declined again, slipping to 49.1 in January from 49.6 in December. New orders dropped 1.9 points to 47.9, production fell 1.4 points to 47.1 and employment held at 48.7. IMEF further raised concerns over Mexico's trade and services sectors — key drivers of Mexico's post-pandemic recovery, noting a recent loss of momentum. The group added this may have implications on the non-manufacturing PMI with its associated sub-components "on the verge of contraction". By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Ethanol prices up on uncertainty, low margins in Feb


25/02/06
25/02/06

Ethanol prices up on uncertainty, low margins in Feb

London, 6 February (Argus) — Spot ethanol prices in northwest Europe firmed to a six-month high at the start of February after several months of remaining largely steady. The minimum 64pc greenhouse gas (GHG) savings ethanol spot price reached €700/m³ on 4 February, its highest since 2 August 2024. Despite this, participants are reporting ample supply in the region, sufficient to meet current demand. The gains are largely attributed to a closed arbitrage with the US, higher production costs and ongoing uncertainty surrounding potential US tariffs. Some market participants believe the price rise in the ARA region is partially driven by higher ethanol prices in the US, which have been supported by rising corn prices . These participants said European prices may have tracked US price gains given the closed arbitrage with the country, with expectations that the arbitrage between the regions will reopen as a result of higher ethanol prices in ARA. Looking ahead, some market participants predict that ethanol imports will be reduced in the second quarter, which has caused the ethanol forward curve to shift into contango, with prices peaking at €711/m³ for the second quarter on 5 February. Trump tariffs turmoil Participants said prices are also being supported by uncertainty surrounding US president Donald Trump's plans to impose tariffs on imports from the EU. The European Commission said this week it will respond "firmly" should Trump "unfairly or arbitrarily" impose tariffs on EU goods. Trump made a similar complaint about the UK, but said he thinks "that one can be worked out". Retaliatory tariffs from the EU could affect ethanol flows, as the EU is a net importer of fuel ethanol. It imported almost 69,000t of undenatured ethanol — usually used for road fuel blending in most EU member states — from the US in January-November 2024, according to provisional EU customs data. The UK imported almost 600,000t of ethanol during the same period. The UK can leverage favourable arbitrage opportunities to import ethanol from the US and redirect it to the EU. Producers face higher costs Argus calculations show ethanol production margins for corn and wheat at €168.69/m³ and at €146.71/m³ on 5 February, down from €223.56/m³ and €205.33/m³ a year ago. Variable costs of yeasts, enzymes, chemicals and denaturants are not included in these calculations. Market participants said producers continue to adjust to a poor 2024-25 harvest season in Eastern Europe, caused by unfavourable weather conditions in Ukraine and France. Higher feedstock costs have contributed to higher ethanol prices, although the production margins are still tighter than last year. In Ukraine, Europe's largest wheat exporter excluding Russia, Argus forecasts wheat production will drop to 22.3mn t during 2024-25 , down from a five-year average of 24.7mn t. Corn supply from the country for 2024-25 is projected to fall to 22.9mn t, down from 31.5mn t in the previous season, according to Argus data. France — Europe's largest producer of ethanol — has cut its wheat production outlook for 2024-25 because of wet weather. Rainfall in other parts of Europe has affected corn toxin levels, potentially leading to poorer quality ethanol. This is likely to weigh on ethanol output in 2025 as it will strain feedstock supplies, push production costs up and squeeze margins for producers. More recently, European market participants said a late-winter cold snap may affect winter crops in Ukraine, and if so, strain feedstock supplies and push ethanol production costs up further. It comes as markets are still waiting for an update on level 2 in the nomenclature of territorial units for statistics GHG emission values, the so called Nuts 2 values. Biofuel producer Archer Daniels Midland expects ethanol profit margins to narrow this year, after posting wider margins in the fourth quarter. The company expects ethanol margins to drop to break-even in the first quarter on higher industry run rates, even as robust demand for exports from the US supports improved volumes, it said. ADM is one of the largest exporters of ethanol to Europe, according to those in the market. By Evelina Lungu Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EU SAF mandate resets US market as credits uncertain


25/02/06
25/02/06

EU SAF mandate resets US market as credits uncertain

Houston, 6 February (Argus) — Looming questions over federal tax credits, supply concerns, and the future of trade flows are causing concerns for US sustainable aviation fuel (SAF) market participants, while buyers address needs in Europe given newly introduced mandates. The domestic SAF market in the US is spurred by incentives in the form of tax credits and subsidies. This "carrot instead of stick" method is meant to bridge the gap between the high cost of investment and production of SAF, making it feasible for airlines to consume and utilize the carbon-abating abilities of the low carbon fuel. The recent expiration of the 40B blenders tax credit has made its mark on the biofuels landscape, eating into the margins of products made with more carbon-intensive feedstocks and altering trade flows on a global level. With importers to the US west coast unable to capitalize on the federally backed incentive, producers like Neste who made up more than half of the SAF market in the US in 2024 direct their Singapore-based volumes elsewhere. US west coast delivered prices during the fourth quarter of 2025 ranged from $4.80/USG to $5.98/USG, reflective of volatility in the conventional jet basis as well as inconsistent supply available at major points of uplift. Prices in the third quarter of 2024 ranged from $4.20/USG to $5.50/USG given greater anticipation of sufficient supply later in the year. Coupled with limited domestic production that decreased from 16.5mn USG in the third quarter to 6.6mn USG in the fourth quarter, the supply of SAF in the US available on a spot basis has dwindled. EU-wide SAF mandates kicked in at 2pc this year, rising to 6pc by 2030. But it is not until 2035 when the obligation hikes up to 20pc — with a 5pc sub-mandate for renewable fuels of non-biological origin — that the region will tip into a short position. The UK is on a similar demand trajectory, going from 2pc this year to 10pc by 2030 and 15pc by 2035, while aiming for a 52pc cap on the SAF total being Hydrotreated Esters and Fatty Acid-based. Combined, this could result in Europe's supply/demand balance going from a 200,000 t/yr surplus in 2030 to a -9.1mn t deficit by 2035, according to Argus Consulting estimates. Given the newly introduced European SAF mandate, air carriers that operate in both regions look to secure volumes at major points of uplift around western Europe. Given the lower supply in the US and fluctuating prices given those changes in supply on the west coast, market activity maintains fixed on the other side of the Atlantic. By Matthew Cope and Amandeep Parmar Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

BP puts Gelsenkirchen refinery in Germany up for sale


25/02/06
25/02/06

BP puts Gelsenkirchen refinery in Germany up for sale

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