Italy palm oil imports fall as works cut demand

Italy's palm oil imports fell on the year in September as works at hydrotreated vegetable oil (HVO) plants reduced demand.

Provisional customs data show imports of 120,000t in September, down by 23pc on the year, up slightly from 115,000t on the month. The September figure is likely to rise by around 5,000t, as imports from other EU countries are added. The fall on the year is probably the result of maintenance at Eni's 650,000 t/yr Gela and 350,000 t/yr Venice HVO units, where palm oil is the main feedstock.

Eni has failed to run its two plants at nameplate capacity, which it anticipated by the end of 2019. But the firm now expects the units at 80pc of capacity by the end of 2020, with full capacity in 2021.

While blenders' methyl ester biodiesel (Fame) demand has fallen as a result of the Covid-19 pandemic, appetite remains for HVO, which competes with biodiesel in diesel blending but can be mixed without limit. EU HVO production has been firm throughout the pandemic, pushing Italian palm imports close to 1.25mn t in the first three quarters of the year, up by 6pc on the same period in 2019, with 735,000t from Indonesia and 295,000t from Malaysia.

Some support for Italian palm oil imports was expected from refiner Saras, which aimed to boost HVO co-processing at its 300,000 b/d Sarroch refinery. But the company has cut its 2021 capital expenditure to €50mn from €160mn, and it is unclear if extra palm oil will be processed.

Provisional data show Italy's imports of fatty acid distillates (Pfad) rose by 40pc year on year to 35,000t in September, supported by demand at Musim Mas' 250,000 t/yr Livorno biodiesel unit, which uses Pfad as feedstock. This data excludes imports from other EU countries. Imports in January-September totalled 255,000t, up by 14pc on the year.

By Adam Porter

Italy palm oil, Pfad imports '000t