Waste biodiesel pressure on rapeseed 'abnormal': Fediol

Rapeseed markets are under "abnormal" pressure from waste biodiesel, said Fediol, the EU vegetable oil and protein meal industry trade association.

"The magnitude of biodiesel imports' growth is such that it raises question as to the authenticity of their classification as originating from waste streams," Fediol said. "There is urgent need to investigate the legitimacy of these imports".

Fediol noted that increased waste-based imports of hydrotreated vegetable oil (HVO) or fatty acid methyl esters (Fame) are leading to "important" disturbances in EU markets for rapeseed methyl ester.

Over the last five months, rapeseed oil prices have dropped significantly with Argus prompt RSO 5-40 loading prices sliding to an average of €820/t so far in May, down by 25pc — or €270/t — compared with January. This also drove down physical rapeseed prices for spot delivery, Fediol added.

Futures prices for new rapeseed crop have also declined with the Euronext August contract down to around €400/t by mid-May, from around €550/t in early January 2023.

"Damage is unprecedented with European market operators across the board taking a massive direct hit. Several plants are currently stopped," said Angel Alvarez, secretary general at waste-based biodiesel association Ewaba. "If the situation is prolonged, we will see bankruptcies. This is unacceptable when the EU has just adopted sound regulatory instruments to promote this EU industry, not Chinese industry," Alvarez told Argus.

"We expect measures from certification schemes, national authorities and the EU to urgently correct this," he added.

Stakeholders have until now declined to comment on possible EU trade measures, including circumvention and anti-dumping duties.

By Dafydd ab Iago