Spanish biodiesel producers are fighting for profits and market share as exports climbed to new highs but imports fell in the first half of the year.
Spanish imports rose to 135,000t in June, according to customs data, up from 120,000t in May and by 4pc on the year. Imports in January-June were 725,000t, down by 11pc year on year.
The biggest exporter to Spain was China, which took a record 22pc market share of Spanish imports, sending 160,000t, up by 17.5pc on the year, all of which is produced from waste vegetable oils (Ucome). Italy exported 135,000t and 120,000t came from the Netherlands.
While imports have declined, exports increased to record levels in January-June (see chart). Spain exported close to 230,000t in June, the second highest for any month, up by 27pc on the year and from 140,000t in May. This meant cargoes rose to 1.07mn t in the first half of the year, up by 3.5pc and a new high for the period.
The main export destinations were Italy with 365,000t, France with 285,000t, the Netherlands with 195,000t, the US with 95,000t and Bulgaria with close to 75,000t.
Some will be re-exported cargoes, but falling imports point to significant exports of domestic output.
Domestic producers have been complaining of thin margins for over a year, in part the result of high feedstock, energy and CO2 costs, and also by weak demand. But while some companies may have trimmed runs, none have shut down. Firms are engaged in a tussle over market share, prepared to maintain output even when profits are scarce. This is in part the result of Spain increasing domestic production capacity to around 3mn t/yr. Some of that capacity has only ramped up since the end of the pandemic.
Competition from hydrotreated vegetable oil (HVO) is also strong with integrated Repsol, BP and refiner Cepsa all producing co-processed HVO. In addition at least three cargoes from the Amsterdam-Rotterdam-Antwerp region have been added to Spanish storage. More HVO imports are expected in the fourth quarter. Some will be for blending with diesel and buyers said some will be used to hit mandates as XTL diesel, which is pure HVO, under the EN15940 nomenclature.
The planned start up of Repsol's 250,000 t/yr Cartagena HVO unit this year could heighten competition, and the firm said it wants to refit refinery units to further increase its HVO capacity.
HVO is produced by treating vegetable oil with hydrogen and counts against biodiesel blend mandates, but is molecularly separate from biodiesel output by esterification.
With domestic demand down by 80,000t on the year at 615,000t in January-June, apparent production — assessed using import, export and demand data — does not appear to have fallen. Estimated output of 930,000t in January-June is up by 3pc on the year.
