Riograndense começa a processar óleo de soja

Spanish Market: Agriculture, Biofuels, LPG, Oil products, Petrochemicals
08/11/23

A Refinaria de Petróleo Riograndense processou sua primeira carga de 100pc de óleo de soja entre outubro e novembro, assumindo a vanguarda do biorrefino no país.

O teste com 2.000t do óleo vegetal aconteceu durante uma parada para manutenção que preparou a unidade de craqueamento catalítico fluido (FCC) para receber a matéria-prima.

No futuro, a Riograndense produzirá insumos petroquímicos e combustíveis renováveis, como GLP (gás de cozinha), combustíveis marítimos, propeno e bioaromáticos.

O segundo teste está programado para junho de 2024, quando a unidade irá coprocessar carga fóssil com bio-óleo, gerando propeno, gasolina e diesel com conteúdo renovável a partir de insumo avançado de biomassa não alimentar.

A refinaria tem como acionistas a Petrobras, a petroquímica Braskem e o grupo Ultra.

A Petrobras já está produzindo diesel coprocessado — conhecido como diesel R5 — usando óleo de soja refinado como matéria-prima desde setembro de 2022. A estatal também tem planos de produzir diesel renovável e bioquerosene de aviação.

O investimento para processar insumos renováveis será ao redor de R$45 milhões.

Por Alexandre Melo

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23/12/24

Viewpoint: European HVO demand to rise in 2025

London, 23 December (Argus) — European demand for hydrotreated vegetable oil (HVO), or renewable diesel, will be supported in 2025 by a combination of higher mandates for the use of renewables in transport, and by changes to EU member state regulations on the carryover of renewable fuels tickets, like in Germany and the Netherlands . European HVO production could grow by more than 400,000t in 2025, if announced projects are completed in time. Most new plants have the flexibility to switch to sustainable aviation fuel (SAF) production, in the form of hydrotreated esters and fatty acids synthesised paraffinic kerosene (HEFA-SPK). But those seeking to import HVO into the EU will face barriers. Definitive EU anti-dumping duties (ADDs) on Chinese biodiesel and HVO will be imposed by mid-February , and anti-dumping and anti-subsidy duties are already in place for HVO and biodiesel of US and Canadian origin . Flows of US-origin HVO to the UK are unimpeded as transposed EU duties were removed in 2022 . A clean slate... Against a headwind of gradually shrinking diesel demand, national transport renewables mandates are increasing. These ambitions rise again under the next iteration of the EU's Renewable Energy Directive (RED III), for which member states face a May 2025 transposition deadline. Optimism in the biofuels markets will be tempered by experiences in 2024. The low value of renewable fuel tickets — tradeable credits generated primarily by the sale of biofuel-blended fuels — in major European demand centres has weighed on supplier appetite for physical biofuels. This includes the relatively expensive HVO that can be blended in much greater volumes than cheaper fatty acid methyl esters (Fame). A portion of these tradeable tickets can usually be carried over from one obligation year to the next — as was done from 2023-24 — extending pressure on physical biofuel demand. But Germany has approved a law removing the option for companies to carry over excess 2024 greenhouse gas (GHG) certificates through both 2025 and 2026, aimed at resetting the outlook for physical renewables demand. Obligated parties will need start from scratch to meet their annual GHG savings targets — at 10.6pc for 2025 and 12.1pc for 2026 — resulting in greater demand for physical biofuels including HVO. In the Netherlands, the tickets carryover will be reduced from 25pc to 10pc for companies with an annual blending obligation. ...follows volatility Prompt HVO assessments firmed significantly late in 2024 — albeit from long-term lows — driven by short-term demand in the Netherlands at a time of tight regional supply. HVO (Class II) fob ARA range, a European benchmark based on HVO produced from used cooking oil (UCO), peaked at $1,500/m³ as a premium to escalated gasoil by 14 November — or a 122pc increase from the start of October — equating to $2,652.91/t on an outright basis. Assessments then fell back to a $860/m³ premium a week later, when the market rebalanced as suppliers looked to reroute prompt volumes. Before the rise, prices had hovered around historically soft levels for a sustained period. Sweden's decision to slash its GHG emissions mandate for the 2024-26 period due to fuel price concerns, and the low ticket prices have kept a lid on values. The HVO (Class II) outright price averaged around $1,625/t over 1 January-31 October 2024, down by around $580/t compared with the same period of 2023. While fundamentals now point to growth in European HVO use, the futures curve is backwardated. Those in the market may yet take a position that aligns with this viewpoint, but recent volatility has stunted forward trade. By Toby Shay Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: US tax fight next year crucial for 45Z

23/12/24

Viewpoint: US tax fight next year crucial for 45Z

New York, 23 December (Argus) — A Republican-controlled Congress will decide the fate next year of a federal incentive for low-carbon fuels, setting the stage for a lobbying battle that could make or break existing investment plans. The 45Z tax credit, which offers greater subsidies to fuels that produce fewer emissions, is poised to kick off in January. Biofuel output has boomed during President Joe Biden's term, driven in large part by west coast refiners retrofitting facilities to process lower-carbon fats and oils into renewable diesel. The 45Z tax credit, created by the 2022 Inflation Reduction Act (IRA), was designed to extend that growth. But Republicans will soon control Washington. President-elect Donald Trump has dismissed the IRA as the "Green New Scam", and Republicans on Capitol Hill, who had no role in passing Biden's signature climate legislation, are keen to cut climate spending to offset the steep cost of extending tax cuts from Trump's first term. Biofuels support is a less likely target for repeal than other climate policies, energy lobbyists say. But Republicans have already requested input on 45Z, signaling openness to changes. Republicans plan to use the reconciliation process, which enables them to avoid a Democratic filibuster in the Senate, to extend tax breaks that are scheduled to expire in 2025. "I want to place our industry in a place to make sure that the biofuels tax credit is part of reconciliation," said Kailee Tkacz Buller, president of the National Oilseed Processors Association. But lawmakers "could punt the biofuels discussion if stakeholders aren't aligned." A decade ago, biofuel policy was a simple tug-of-war between the oil and agriculture industries. Now many refiners formerly critical of the Renewable Fuel Standard produce ethanol and advanced biofuels themselves. And the increasingly diverse biofuels industry could complicate efforts to present a united front to Congress. Farm groups worry about carbon intensity scoring hurting crop demand and have lobbied to curtail record-high feedstock imports, to the chagrin of some biorefineries. Those producers are no monolith either: Biodiesel plants often rely more on local vegetable oils, while ethanol producers insist on keeping incentives that do not discriminate by fuel type and some oil majors would back subsidizing fuels co-processed with petroleum. Add airlines into the picture, which want greater incentives for aviation fuels, and marketers frustrated by 45Z shifting subsidies away from blenders — and the threat of fractious negotiations next year becomes clear. There are options for potential compromise, according to an Argus analysis of comments submitted privately to Republicans in the House of Representatives, as well as interviews with energy lobbyists and tax experts. The industry, frustrated by the Biden administration's delays in clarifying 45Z's rules, might welcome legislative changes that limit regulatory discretion regardless of what agency guidance eventually says. And lobbyists have floated various ways to appease agriculture groups without kneecapping biorefineries reliant on imports, including adding domestic content bonuses, imposing stricter requirements for Chinese-origin used cooking oil, and giving preference to close trading partners. Granted, unanimity among lobbyists is hardly a priority for Republican tax-writers. Reaching any consensus in the restive caucus, with just a handful of votes to spare in the House, will be difficult enough. "These types of bills always come to down to what's the most you can do before you start losing enough votes to pass it," said Jeff Navin, cofounder of the clean energy advocacy firm Boundary Stone Partners and a former House and Senate staffer. "Because they can only lose a couple of votes, there's not much more beyond that." And the caucus's goal of cutting spending makes an industry-wide goal — extending the 45Z credit into the 2030s — even more challenging. "It is a hard sell to get the extension right away," said Paul Winters, director of public affairs at Clean Fuels Alliance America. Climate costs Cost concerns also make less likely a simple return to the long-running blenders credit, which offered $1/USG across the board to biomass-based diesel. The US Joint Committee on Taxation in 2022 scored the two-year blenders extension at $5.5bn, while pegging three years of 45Z at less than $3bn. An inconvenient reality for Republicans skeptical of climate change is that 45Z's throttling of subsidies based on carbon intensity makes it more budget-friendly. Lawmakers have other reasons to not ignore emissions. Policies elsewhere, including California's low-carbon fuel standard and Europe's alternative jet fuel mandates, increasingly prioritize sustainability. The US deviating from that focus federally could leave producers with contradictory incentives, making it harder to turn a profit. And companies that have already sunk funds into reducing emissions — such as ethanol producers with heavy investments in carbon capture — want their reward. Incentives with bipartisan buy-in are likely more durable over the long run too. Next time Democrats control Washington, liberals may be more willing to scrap a credit they see as padding the profits of agribusiness — but less so if they see it as helping the US decarbonize. By Cole Martin Tax credit changes 40A Blenders Tax Credit 45Z Producers Tax Credit $1/USG Up to $1/USG for road fuels and up to $1.75/USG for aviation fuels depending on carbon intensity For domestic fuel blenders For domestic fuel producers Imported fuel eligible Imported fuel not eligible Exclusively for biomass-based diesel Fuels that produce no more than 50kg CO2e/mmBTU are eligible Feedstock-agnostic Carbon intensity scoring incentivizes waste over crop feedstocks Co-processed fuels ineligible Co-processed fuels ineligible Administratively simple Requires federal guidance on how to calculate carbon intensities for different feedstocks and fuel pathways Expiring after 2024 Lasts from 2025 through 2027 Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: Brazil may face road bottleneck in 1Q

23/12/24

Viewpoint: Brazil may face road bottleneck in 1Q

Sao Paulo, 23 December (Argus) — The Brazilian soybean harvest and fertilizer deliveries for the country's 2024-25 second corn crop will likely drive first-quarter grain and fertilizer road freight rates higher. Grain freight rates have been unusually low in 2024 because lower international soybean prices discouraged producers from doing business in most months. But market participants expect greater demand for transportation services in export corridors in 2025, as an expected record 2024-25 harvest combines with a US dollar that has strengthening against the Brazilian real, driving export demand. Brazil will produce 166.2mn metric tonnes (t) of soybeans in the 2024-25 cycle, an increase of almost 13pc from the previous season, according to national supply company Conab's third official estimate for the cycle. The 2024-25 soybean harvest in Mato Grosso state — Brazil's largest producer — will total 44mn t, also 13pc above 2023-24 production, according to the state's institute of agricultural economics Imea. Mato Grosso's soybean planting pace for 2024-25 has fluctuated significantly over the growing season, initially advancing slowly because of dry weather, and then speeding up once rains returned. Planting was complete on only 25pc of the almost 12.7mn hectares (ha) expected for the cycle by 18 October, less than the 60pc reached at the same time in 2023 for the 2023-24 cycle. But planting increased by 68.6 percentage points in the following three weeks, totaling 93.7pc by 8 November. As a result, more than half of the soybean planted area in Mato Grosso was carried out in the same three week period. That raises concerns among market participants about high competition for export transportation and available vehicles when all those crops become ready for harvest at the same time, resulting in a logistical bottleneck. Market participants expect lower freight rates for exports during the 2024-25 second corn harvest, set to take place in the second half of 2025. Demand from the Brazilian domestic market will remain at a consistently high level, especially from ethanol units, whose demand for corn was high in 2024, as prices carried a premium to the export market, and also contributed to lower export volumes. This should lead to lower grain freight rates during the second half of 2025, with a significant portion of grain destined to meet the Brazilian industry's needs. Corn ethanol production in Brazil is expected to total 7.2bn liters (124,865 b/d) in the 2024-25 cycle, a 22pc increase from 5.9bn l in the previous cycle, according to Conab. The company projects that 1t of corn can produce around 400l of ethanol, which means that approximately 18mn t of corn will be consumed by the ethanol industry. Brazil is expected to produce around 86.2mn t of animal feed in 2024, 2.3pc more than it did in 2023, according to the sector's national union Sindiracoes. This should stimulate demand for about 55mn t of corn for all animal feed production expected this year. Animal feed production is expected to grow further in 2025 to 87.8mn t. Ferts freight rates may also increase Fertilizer transportation may face logistical bottlenecks to move inputs from ports to crops in early 2025 because of the slow pace of fertilizer purchases, especially nitrogen, for the 2024-25 second corn harvest. With the purchase window coming to a close by the end of December, market participants estimate that these nutrients have to arrive at Brazilian ports by early January, so that they can be transported in time for application during the grain harvest. That may also increase competition for vehicles in the first quarter of 2025, especially in January, when the supply of trucks is reduced following end-of-year festivities. Under these circumstances, higher fertilizer freight rates and higher costs for road logistics are expected. By João Petrini Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

German heating oil demand dips, diesel stocks reduced

23/12/24

German heating oil demand dips, diesel stocks reduced

Hamburg, 23 December (Argus) — Heating oil consumers in Germany are refraining from purchasing because of high inventories, while importers are lowering their diesel stocks to maintain low bio-blended reserves. Reported volumes of heating oil traded to Argus fell by nearly 35pc last week. Consumers see little need to increase their stocks that, although they have steadily declined, remain higher than the same period in 2023 at 59.6pc, Argus MDX data show. Heating oil traded at about €1.50/100l higher than the previous week, further deterring consumers from last-minute purchases ahead of the Christmas holiday. Importers are striving to keep their diesel stocks minimal until the year's end. Obligated parties will be unable to use any surplus greenhouse gas (GHG) certificates from previous years in 2025 and 2026, so importers that have already met their obligations this year are eager to avoid generating more certificates until January. As a result, demand is low for diesel imports into Germany's northern ports and to storage facilities along the Rhine river. Northern Germany experienced a significant drop in imports in December to the lowest since September, Vortexa data show. But importers and barge operators are preparing for increased import activity in early 2025 to replenish their biodiesel inventories as quickly as possible. Suppliers at the Bayernoil consortium's 215,000 b/d Vohburg-Neustadt refinery in Bavaria are experiencing low stocks, primarily as a result of heightened demand in early December when buyers were active before an increased CO2 levy and the GHG quota take effect on 1 January. By Natalie Müller Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: European large cargo propane to tighten

23/12/24

Viewpoint: European large cargo propane to tighten

London, 23 December (Argus) — The large cargo cif Amsterdam-Rotterdam-Antwerp (ARA) propane market is set to tighten on supply constrains in 2025, as regional supplies and imports could slow, but demand is likely to remain erratic. Local availability from the North Sea is suppressed, with natural gas prices higher than those for propane. Production is largely dependent on gas processors that have the ability leave propane in the natural gas stream when the lighter grade becomes significantly cheaper, to maximise profits and yields. Current economics favour natural gas. The average spread between the fuels so far in December places large cargo propane at an average -$130/t discount, incentivising price-sensitive refineries to hold on to their propane. The forward curve for natural gas is in a contango structure, reflecting ample stocks and sluggish demand for the season, and a stronger outlook for next year. In contrast, prompt propane is priced higher than future values. The European propane swaps curve is heavily backwardated out to June 2025, with a January-February spread at $12/t and February-March at $19/t, widening the discount of the lighter grade against natural gas. This creates conditions for gas processors to leave more LPG in the gas stream over the first half of the year, possibly tipping local balances into tightness. Supply from European refiners that can switch from sellers to consumers of LPG, and use their own LPG production depending on the price balance between propane and natural gas, has so far been unaffected. The fca propane inland railcar price has hovered at a significant premium against natural gas in recent months, but if the lighter grade loses strength then production from refineries could be trimmed. With weaker regional output, European buyers will be more reliant on US imports. In the first half of 2024, the European region was flooded with US LPG, but this is unlikely to be repeated. The Panama Canal drought led to transit difficulties at the beginning of 2024, creating long queues and increasing delivery costs to send product east, freeing a surplus of US LPG to Europe at a time when demand was subdued. Transits through the Canal dropped by almost 30pc in 2024, according to the Panama Canal Authority. Yet, in recent months steady levels of precipitations pushed the water levels at the Gatun lake, the reservoir that supplies the isthmus, to a two-year high. Early forecasts indicate the passage will remain a reliable route for the first quarter of 2025. With no constraints to move US product east, European buyers would have to compete with the steep premiums typically offered in Asia-Pacific, creating tougher conditions to secure US LPG. Demanding conditions On the demand side, consumption from the petrochemical sector is likely to rise somewhat over the first quarter of 2025 as operating rates pick up, although margins are unlikely to improve by much. Ethylene crackers, which can oscillate between LPG and naphtha depending on economics, currently favour the latter, as the December propane-naphtha differential has hovered below the -$50/t discount threshold that incentivises a switch to naphtha and suppresses demand for propane. But forward curves show a steady widening of the negative differential in the first half of 2025, which should put propane back into the game. Demand from the heating sector has been lukewarm due to the mild weather conditions in Europe, and temperatures could remain slightly above seasonal averages in the UK, France and Germany in December and January, Speedwell Weather data show. Even without any strong demand, the prevailing sentiment looks a notch more bullish in the first half of 2025 than in the first six months of 2024, when the region was oversupplied and pressured by the excess selling competition. In contrast, in 2025 European buyers might be faced with an uphill fight to seize US product and to secure local production. By Efcharis Sgourou Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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