The European biodiesel complex has been mixed since the previous week (see Figure 1). The Vesper West-EU Price Index for RME (2024-01-02) increased by 1.2% to €1111 | $1227 / mt (FOB ARA) compared to the 2023-12-22 price level. The Vesper West-EU Price Index for UCOME (2024-01-02) decreased by 3.2% to €1168 | $1289 / mt (FOB ARA) compared to the 2023-12-22 price level. The Vesper West-EU Price Index for FAME (2024-01-02) increased by 0.3% to €979 | $1080 / mt (FOB ARA) compared to the 2023-12-22 price level.
Figure 1: Vesper Spot Outright Biodiesel Prices (USD/mt)
According to Vesper’s Biodiesel Market Insights, the initial week of January tends to be subdued in the market. LSGO (Jan 24) settlement price (ICE EU) decreased to €691 | $754 / mt (2024-01-04) from €693 | $770 / mt on 2023-12-28 (see Figure 2). Overall, the combination of reduced energy demand, increasing inventories, lower expectations for interest rate cuts and a stronger US dollar put some pressure on LSGO.
Figure 2: ICE LSGO – Settle Mar 24 (USD/mt)
Escalating maritime freight costs associated with the Red Sea attacks may influence the scenario, potentially redirecting focus to the local European biodiesel market from China if rates and insurance become excessively expensive. Biodiesel demand hinges on the severity of the winter weather conditions.
Vegetable Oil Market Prices:
- Crude Palm Oil (Jan 24) settlement price (BMD) increased to €727 | $794 / mt (2024-01-04) from €712 | $792 / mt on 2023-12-28 on the outlook for dwindling stocks despite a drop in exports at the end of December.
- Soybean Oil (Jan 24) settlement price (CBOT) increased to €966 | $1055 / mt (2024-01-04) from €941 | $1047 / mt on 2023-12-28 as Brent Crude oil is w-o-w higher compared to 2023-12-28 price level.
- Rapeseed (Feb 24) settlement price (MATIF) decreased to €431 | $470 / mt (2024-01-04)
from €441 | $490 / mt on 2023-12-28. The Vesper West EU Forward Price Index for Crude Rapeseed Oil (2024-01-04) decreased to €874 | $954 / mt (FOB DutchMill/Extank, Feb-Mar-Apr) from €885 | $978 / mt same period last week. - The Vesper West EU Forward Price Index for Crude Sunflower Oil (2024-01-04) decreased to €865 | $945 / mt (6 ports, JFM) from €868 | $955 on 2023-12-22.
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