We are looking at nearly $91/mt of backwardation on Diesel to Sep24 which is higher than what we saw in 2022. +142% in last 3 months for good measure. Futures are telling us something is seriously off despite clear demand issues in Europe with farmer strikes in France, Germany, and Netherlands. One should not forget that Germany airports are essentially shut today with security officers on strike. Biodiesel premium remain weak as is BOGO which has developed a deep contango of $82/mt through Sep while biodiesel screen crush margin continue to improve +55% in last 3 months! All of this margin improvement is not only led by strong diesel prices but also by weakening feedstock prices which is pushing everyone to exceed mandates - particularly in US as producers are riding the Biden IRA wave. RINs and LCFS are remaining surprisingly strong despite these considerable margin driven production numbers.
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