Diesel Backwardation Returns — But the Real Story Is Soymeal
Backwardation snapped back into ICE gasoil today with Dec/Apr blowing out to +30.75 and Dec/Jul trading near +43.50, almost up two standard deviations on the front of the curve. Yet Northwest Europe biodiesel values stayed impressively stable. In ARAG, FAME 0 RED held a tight 1,294–1,299 $/mt range with the month-to-date at 1,297.33 $/mt, while RME stayed locked in at 1,434–1,439 $/mt and a month-to-date of 1,436.33 $/mt. Premiums versus gasoil widened simply because gasoil rallied harder: FAME RED hovered around 624–639 over the GO swap and RME RED around 761–784. UCOME traded slightly softer at 1,452–1,467 $/mt and HVO Class 2 weakened more visibly to 2,458–2,589 $/mt as the escalated swap slipped again from 1,858 to 1,748 $/m³. Northwest European feedstocks were quiet to softer, with soybean oil Dutch origin around 1,105 €/mt for January and 1,095 €/mt for February, rapeseed oil drifting to 1,069 €/mt for Feb–Apr and 1,059 €/mt for May–Jul, and sunflower oil around 1,350 €/mt. EUR/USD firmed toward 1.1670, nudging replacement values higher despite unchanged euro feedstock prices. The overall tone of the ARAG window was one of calm stability, with biodiesel values essentially pinned to the gasoil curve rather than physical tightness.
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