By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel producers are seeking brand-new outlets in Asia for their exports and exploring producing other biofuels as supply to the European Union, their biggest purchaser, dries up ahead of anti-dumping tariffs, biofuel executives and experts stated.

The EU will enforce provisional anti-dumping tasks of between 12.8% and 36.4% on Chinese biodiesel from Friday, striking over 40 business consisting of leading producers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export organization that deserved $2.3 billion last year.

Some bigger manufacturers are eyeing the marine fuel market in China and Singapore, the world's leading marine fuel center, as they seek to offset already falling biodiesel exports to the EU, biofuel executives stated.

Exports to the bloc have actually fallen sharply since mid-2023 amid investigations. Volumes in the very first 6 months of this year plunged 51% from a year previously to 567,440 lots, Chinese custom-mades data revealed.

June deliveries shrank to just over 50,000 heaps, the most affordable since mid-2019, according to customizeds information.

At their peak, exports to the EU reached a record 1.8 million lots in 2023, representing 90% of all Chinese biodiesel exports that year. The Netherlands was the top importer in 2023, soaking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese custom-mades figures showed.

Chinese manufacturers of biodiesel have actually delighted in fat earnings over the last few years, maximizing the EU's green energy policy that approves aids to companies that are utilizing biodiesel as a sustainable transport fuel such as Repsol, Shell and Neste.

Many of China's biodiesel manufacturers are privately-run little plants employing scores of employees processing waste oil collected from millions of Chinese dining establishments. Before the biodiesel export boom, they were making lower-value goods like soaps and processing leather items.

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

Anticipating the tariffs, traders stockpiled on utilized cooking oil (UCO), raising costs 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 need, and free-falling product rates, business are having a difficult time enduring," said Gary Shan, chief marketing officer of Henan Junheng.

Prices of hydrotreated veggie oil, or HVO, a primary kind of biodiesel, have halved versus last year's average to the existing $1,200 to $1,300 per metric heap and are off a peak of $3,000 in 2022, Shan included.

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

Meanwhile, diminishing biodiesel sales are increasing China's UCO exports, which analysts forecast are set to touch a new high this year. UCO exports skyrocketed by two-thirds year-on-year in the very first half of 2024 to 1.41 million lots, with the United States, Singapore and the Netherlands the top locations.

OUTLETS

While many smaller plants are likely to shutter production indefinitely, larger producers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring new outlets consisting of the marine fuel market in the house and in the important hub of Singapore, which is using more biodiesel for ship fuel mixing, according to the biofuel executives.

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

Companies would likewise speed up preparation 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 searching for new biodiesel customers outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are regional requireds for the alternative fuel, the officials included.

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