By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel manufacturers are looking for brand-new outlets in Asia for their exports and checking out producing other biofuels as supply to the European Union, their greatest buyer, dries up ahead of anti-dumping tariffs, biofuel executives and experts stated.

The EU will impose provisionary anti-dumping tasks of in between 12.8% and 36.4% on Chinese biodiesel from Friday, hitting over 40 business including leading producers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export company that deserved $2.3 billion last year.

Some larger manufacturers are considering the marine fuel market in China and Singapore, the world's top marine fuel hub, as they look for to offset already falling biodiesel exports to the EU, biofuel executives stated.

Exports to the bloc have actually fallen dramatically since mid-2023 amidst examinations. Volumes in the first 6 months of this year plunged 51% from a year earlier to 567,440 lots, Chinese custom-mades information showed.

June shipments diminished to simply over 50,000 heaps, the most affordable because mid-2019, according to customizeds information.

At their peak, exports to the EU reached a record 1.8 million loads in 2023, representing 90% of all Chinese biodiesel exports that year. The Netherlands was the leading importer in 2023, taking in 84% of China's biodiesel deliveries to the EU, followed by Belgium and Spain, Chinese customizeds figures showed.

Chinese producers of biodiesel have delighted in fat revenues in current years, making the most of the EU's green energy policy that gives subsidies to business that are using biodiesel as a sustainable transportation fuel such as Repsol, Shell and Neste.

A lot of China's biodiesel producers are privately-run little plants employing scores of employees processing waste oil gathered from countless Chinese dining establishments. Before the biodiesel export boom, they were making lower-value products like soaps and processing leather items.

However, the boom was temporary. The EU began in August in 2015 investigating Indonesian biodiesel that was presumed of preventing responsibilities by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel believed to be priced synthetically low and damaging local manufacturers.

Anticipating the tariffs, traders stocked up on used cooking oil (UCO), raising rates of the feedstock, while costs of biodiesel sank in view of diminishing demand for the Chinese supply.

"With significant prices of UCO partially supported by strong U.S. and European demand, and free-falling product costs, companies are having a difficult time making it through," stated Gary Shan, chief marketing officer of Henan Junheng.

Prices of hydrotreated grease, or HVO, a main kind of biodiesel, have actually halved versus in 2015's average to the current $1,200 to $1,300 per metric ton and are off a peak of $3,000 in 2022, Shan included.

With low rates, biodiesel plants have cut their operations to an all-time low of under 20% of existing capability typically in July, down from a peak of 50% last seen in early 2023, according to Chinese consultancies Sublime China Information and JLC.

Meanwhile, diminishing biodiesel sales are increasing China's UCO exports, which experts anticipate are set to touch a brand-new high this year. UCO exports skyrocketed by two-thirds year-on-year in the very first half of 2024 to 1.41 million loads, with the United States, Singapore and the Netherlands the leading locations.

OUTLETS

While lots of smaller sized plants are most likely to shutter production indefinitely, bigger producers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring brand-new outlets consisting of the marine fuel market in the house and in the important hub of Singapore, which is using more biodiesel for ship fuel blending, according to the biofuel executives.

Among the producers, Longyan Zhuoyue, concurred in January with COSCO Shipping to use more biodiesel in marine fuel.

Companies would also speed up planning and structure of sustainable air travel fuel (SAF) plants, executives stated. China is anticipated to announce an SAF mandate before completion of 2024.

They have actually also been searching for new biodiesel customers outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are local mandates for the alternative fuel, the authorities included.

(Reporting by Chen Aizhu