Biofuel Bunker Snapshot: Bio-VLSFO price continues to fall in Singapore

Dutch rebates for biofuel strengthen

Bio-premiums narrow in Rotterdam

Singapore

Singapore’s B24-VLSFO UCOME price has shed $9/mt in the past week, while its B24-LSMGO UCOME price has declined by a greater $13/mt.

The two bio-bunker prices have declined amid a drop in the underlying UCOME FOB China price. PRIMA Markets assessed the UCOME FOB China benchmark at $950/mt on Friday, down by $20/mt on the week.

Despite a drop in the UCOME FOB China price, buying interest has been little. “The Chinese waste-based biodiesel market declined on Friday, as fresh offers indicated faltering confidence amongst sellers, especially as overseas demand remains limited lately,” PRIMA said.

Declining values of pure VLSFO ($5/mt) and LSMGO ($11/mt) have also contributed to the decline in both biofuel benchmarks.

Singapore’s B24-VLSFO UCOME premium over pure VLSFO has narrowed by $4/mt in the past week to $118/mt, while its B24-LSMGO UCOME premium over pure LSMGO has narrowed by $2/mt to $107/mt.

Rotterdam

Rotterdam’s B30-VLSFO HBE and B30-LSMGO HBE prices have declined by $10-11/mt in the past week, partly because of a $15/mt drop in the in the underlying PRIMA's POMEME CIF ARA price.

The Dutch HBE A ticket price has strengthened over the past week. PRIMA assessed the ticket price at €9.05/GJ ($10.11/GJ) on Friday, up from €8.50/GJ ($9.49/GJ) a week prior. This translates to a $90/mt theoretical rebate for B30-VLSFO HBE blends sold in the Dutch ports, up by $7/mt from $83/mt a week prior.

The rebate has now risen to a level of $90/mt last seen in April for B30-VLSFO HBE, making bunkering of POMEME-based biofuel blends even more attractive in Dutch ports as these blends qualify for Dutch advanced biofuel rebates.

Biofuel price premiums over pure conventional fuels are $176/mt for B30-VLSFO HBE blends and $143/mt for B30-LSMGO HBE blends. These premiums have narrowed by $10/mt in the past week but remain much wider compared to Singapore.

Rotterdam’s B30-VLSFO UCOME and B30-LSMGO UCOME prices have decreased by a marginal $4-5/mt in the past week. The B30-VLSFO UCOME price premium over B30-VLSFO HBE has widened by $6/mt to $84/mt. UCOME-based biofuel blends don’t qualify for Dutch advanced biofuel rebates.

PRIMA Market’s POMEME CIF ARA price has declined by $15/mt to $1,306/mt in the past week. “This drop was mostly in line with the movement seen across the whole biodiesel complex, and reflective of the fact that there has been nothing to combat the oversupply situation the European market is still seeing on the biodiesel front,” PRIMA said.

By Nithin Chandran

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