By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel producers are seeking 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 duties of between 12.8% and 36.4% on Chinese biodiesel from Friday, striking over 40 business consisting of leading producers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export service that deserved $2.3 billion in 2015.

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

Exports to the bloc have actually fallen greatly because mid-2023 amidst examinations. Volumes in the very first 6 months of this year plunged 51% from a year previously to 567,440 loads, Chinese customs data revealed.

June shipments diminished to just over 50,000 tons, the most affordable considering that mid-2019, according to customizeds information.

At their peak, exports to the EU reached a record 1.8 million lots 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 custom-mades figures showed.

Chinese producers of biodiesel have actually enjoyed fat earnings in the last few years, maximizing the EU's green energy policy that grants subsidies to companies that are using biodiesel as a fuel such as Repsol, Shell and Neste.

Many of China's biodiesel producers are privately-run small plants utilizing ratings of employees processing waste oil collected from millions of Chinese restaurants. Before the biodiesel export boom, they were making lower-value products like soaps and processing leather products.

However, the boom was short-term. The EU started in August last year examining Indonesian biodiesel that was believed of preventing tasks by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel thought to be priced artificially low and damaging regional manufacturers.

Anticipating the tariffs, traders equipped up on utilized cooking oil (UCO), lifting prices of the feedstock, while costs of biodiesel sank in view of shrinking need for the Chinese supply.

"With substantial costs of UCO partly supported by strong U.S. and European demand, and free-falling item prices, companies are having a difficult time surviving," stated Gary Shan, primary marketing officer of Henan Junheng.

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

With low prices, biodiesel plants have cut their operations to a lowest level of under 20% of existing capability typically in July, below a peak of 50% last seen in early 2023, according to Chinese consultancies Sublime China Information and JLC.

Meanwhile, shrinking biodiesel sales are improving China's UCO exports, which analysts forecast are set to touch a new high this year. UCO exports skyrocketed by two-thirds year-on-year in the 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 likely to shutter production forever, larger manufacturers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring brand-new outlets consisting of the marine fuel market in your home and in the important hub of Singapore, which is utilizing more biodiesel for ship fuel mixing, according to the biofuel executives.

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

Companies would likewise accelerate planning and building of sustainable air travel fuel (SAF) plants, executives stated. China is expected to announce an SAF required before the end of 2024.

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

(Reporting by Chen Aizhu; Editing by Ana Nicolaci da Costa)