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EU about to face serious supply chain issues from Asia


Suez canal traffic is nosediving. This is having a serious impact on EU dependent imports for Biodiesel, feedstocks, Catalysts and many other materials arriving from Asia. Stocks were high prior to this so effect might start to be felt later in the spring. did notice a vessel of UCO loaded in China mid January arriving only end days of Mar because of longer voyage around cape. This will also impact gasoil but to a lesser extent as US can import from APAC and ship from US gulf to Europe. US markets were closed on Monday but BOGO down more today at +152 while FAME traded in Northwest Europe well above it at +247 reflecting expected logistical issues. EPA EMTS was released and showed how Renewable diesel RIN generation still operating well in excess of mandate yet imports of UCO from China into US are also growing larger with Feb looking like 30% above Jan. We also note large exports of RD from Singapore in February 144kt from 103kt in January which is not going to help the oversupply on the west coast. D4 RINs are finally starting to reflect this, finally trading below 0.50 c/gal but in this writer opinion, we should be closer to 0.20 c/gal especially in view of additional SRE also announced.

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