Spanish biodiesel demand down in February

Spanish biodiesel demand fell in February, according to state-controlled reserve Cores. As usual, it is likely to revise this upward next month.

Cores said demand was 95,000t in February, down by 7.6pc year on year. The comparative figure is likely to increase significantly when Cores revises its 2019 data. Spain's blend mandate this year is 8.5pc — if biodiesel and hydro-treated vegetable oil (HVO) were blended to the national target, this would make consumption 175,000t in February, up from 140,000t on the year.

Cores said demand was 1.29mn t last year, down from 1.72mn t in 2018. This too is likely to be revised up. If Spain had blended to its mandate, then biodiesel consumption would have risen to 1.86mn t in 2019 (see chart).

Cores raised its estimate for 2018 biodiesel demand in June last year, by 430,000t, to 1.7mn t. This may be an underestimate, because Spanish distributors blended over the mandate in 2018. Madrid includes all biofuels — including ethanol blended into the gasoline market — in a single target.

The 2020 8.5pc mandate equates to 7pc of first generation biofuels made from feedstock that can compete with food crops, such as palm oil (PME) or soya oil (SME), 0.75pc of double-counted biodiesel made from waste oils (Ucome) or waste animal fats (TME), and the balance from electric and LPG vehicles. Cores includes hydro-treated vegetable oil (HVO) in its biodiesel demand data and counts it against blend mandates.

Any rise in biodiesel consumption is likely to be tempered by faltering diesel demand. Spanish diesel consumption rose every year between 2013 and 2018, but consumers are switching away from diesel-powered vehicles because of concerns about pollution and impending legislation. Diesel consumption was just over 470,000 b/d in February, Cores said, up by 2.4pc year on year. Gasoline demand rose by 9.8pc over the same period.

By Adam Porter

Spanish biodiesel demand '000t