Weekly California R99 Market Insight

Renewable diesel production capacity is set to double by the end of 2027. With this anticipated growth over the coming years, it is critical to ensure fair and reflective values are provided for market participants. As the leading source of global renewable diesel pricing intelligence, this weekly market insight will shine a light on this relatively new and fast paced market and provide visibility to price indicators.

December 12, 2023

-R99 shipping in December at the head of the pipeline in Los Angeles has weakened.
-Weakness compared to two weeks prior was attributed to imports from abroad, as shipping through the Panama Canal remains expensive for many suppliers. Vessel-tracking data compiled by Argus indicate Los Angeles is set to receive a maximum of 466,000 bl of renewable diesel from Singapore between 15-23 December.
-Meanwhile, a narrowing California R99-B99 spread is signaling lower demand for blends. The narrowing spread suggests renewable diesel is becoming more competitively priced against biodiesel in California, which could spurn buyers from blending the two as blend economics deteriorate. As a result, volumes of biodiesel consumed in California could drop off, with buyers preferring a more competitively priced drop-in replacement fuel like renewable diesel over biodiesel, which must be blended up to certain amounts with either conventional or renewable diesel before being used in motor vehicles.

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