UCO price weakness persists
Market participants report that UCO prices continue to show weakness in both Chinese and European markets. This trend is primarily driven by two factors:
- Softening demand across major consumption regions
- Increasing supply volumes entering the European Union due to US high import tariffs
US-China trade relations impact
While the United States has temporarily reduced tariffs on Chinese goods to 30% for a 90-day period, this rate remains significant enough to impact trade flows. Market participants express concern about:
- Uncertainty regarding post-90-day tariff scenarios
- Potential implications of the 45z credit that would exclude foreign UCO-based biofuels from valuable tax benefits
These factors continue to create market uncertainty and affect investment decisions in the biodiesel sector.
Record EU import volumes
Official EU data shows growth in UCO imports:
- In the first four months of 2025, the EU imported approximately 667,000 metric tons of UCO
- This represents a 16.8% increase compared to the 571,000 metric tons imported during the same period in 2024
- Market indicators suggest even higher volumes may be reported for May and June
Note: These EU figures typically run lower than official customs data but provide valuable trend indicators for market analysis.
Market outlook
The combination of weak prices, increasing imports, and regulatory uncertainty creates a complex landscape for biodiesel market participants. As supply continues to grow and demand remains soft, market fundamentals suggest continued price pressure in the near term.
Complete market analysis
This overview highlights just a few key points from our comprehensive biodiesel market analysis. For detailed insights including:
- Regional price breakdowns
- Regulatory impact assessments
- Supply and demand forecasts
- Trading recommendations
Access our complete Week 20 Biodiesel Market Analysis here: https://app.vespertool.com/market-analysis/1936
