By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel manufacturers are looking for brand-new outlets in Asia for their exports and checking out producing other biofuels as supply to the European Union, their most significant buyer, dries up ahead of anti-dumping tariffs, biofuel executives and analysts said.

The EU will impose provisional anti-dumping duties of between 12.8% and 36.4% on Chinese biodiesel from Friday, hitting over 40 companies consisting of leading producers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export organization that was worth $2.3 billion in 2015.

Some larger producers are eyeing the marine fuel market in China and Singapore, the world's leading marine fuel center, as they look for to balance out currently falling biodiesel exports to the EU, biofuel executives stated.

Exports to the bloc have fallen sharply because mid-2023 amidst investigations. Volumes in the very first 6 months of this year plunged 51% from a year previously to 567,440 loads, Chinese custom-mades information revealed.

June deliveries shrank to just over 50,000 heaps, the most affordable considering that mid-2019, according to customs data.

At their peak, exports to the EU reached a record 1.8 million loads in 2023, representing 90% of all Chinese biodiesel exports that year. The Netherlands was the leading importer in 2023, taking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese customizeds figures revealed.

Chinese producers of biodiesel have actually enjoyed fat profits over the last few years, taking advantage of the EU's green energy policy that approves subsidies to business that are utilizing biodiesel as a sustainable transportation fuel such as Repsol, Shell and Neste.

A lot of China's biodiesel producers are privately-run small plants employing scores of employees processing waste oil collected from millions of Chinese restaurants. Before the biodiesel export boom, they were making lower-value items like soaps and processing leather items.

However, the boom was brief. The EU started in August in 2015 examining Indonesian biodiesel that was presumed of preventing tasks by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel believed to be priced synthetically low and undercutting regional manufacturers.

Anticipating the tariffs, traders stockpiled on utilized cooking oil (UCO), lifting rates of the feedstock, while rates of biodiesel sank in view of shrinking demand for the Chinese supply.

"With large costs of UCO partly supported by strong U.S. and European demand, and free-falling item rates, companies are having a bumpy ride enduring," said Gary Shan, chief marketing officer of Henan Junheng.

Prices of hydrotreated vegetable oil, or HVO, a main type of biodiesel, have actually cut in half versus last year's average to the existing $1,200 to $1,300 per metric load and are off a peak of $3,000 in 2022, Shan included.

With low costs, biodiesel plants have cut their operations to a lowest level of under 20% of existing capability typically in July, below a peak of 50% last seen in early 2023, according to Chinese consultancies Sublime China Information and JLC.

Meanwhile, shrinking biodiesel sales are boosting China's UCO exports, which experts predict are set to touch a brand-new high this year. UCO exports skyrocketed by two-thirds year-on-year in the very first half of 2024 to 1.41 million loads, with the United States, Singapore and the Netherlands the leading destinations.

OUTLETS

While many smaller sized plants are most likely to shutter forever, larger producers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are checking out new outlets including the marine fuel market at home and in the essential hub of Singapore, which is utilizing more biodiesel for ship fuel mixing, according to the biofuel executives.

Among the manufacturers, Longyan Zhuoyue, agreed in January with COSCO Shipping to use more biodiesel in marine fuel.

Companies would likewise accelerate planning and structure of sustainable aviation fuel (SAF) plants, executives stated. China is anticipated to reveal an SAF mandate before the end of 2024.

They have also been scouting for brand-new biodiesel clients outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are regional requireds for the alternative fuel, the authorities added.

(Reporting by Chen Aizhu; Editing by Ana Nicolaci da Costa)