By Chen Aizhu

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

The EU will impose provisionary anti-dumping tasks of in between 12.8% and 36.4% on Chinese biodiesel from Friday, striking over 40 companies consisting of leading manufacturers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export company that deserved $2.3 billion in 2015.

Some bigger manufacturers are considering the marine fuel market in China and Singapore, the world's top marine fuel hub, as they look for to offset currently falling biodiesel exports to the EU, biofuel executives stated.

Exports to the bloc have fallen dramatically because mid-2023 amidst investigations. Volumes in the first six months of this year plunged 51% from a year earlier to 567,440 tons, Chinese customs data showed.

June deliveries shrank to just over 50,000 heaps, the most affordable because mid-2019, according to custom-mades data.

At their peak, exports to the EU reached a record 1.8 million heaps 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 customs figures showed.

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

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

However, the boom was short-lived. The EU began in August in 2015 examining Indonesian biodiesel that was thought of circumventing tasks by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel thought to be priced artificially low and damaging local producers.

Anticipating the tariffs, traders stocked up on used cooking oil (UCO), lifting rates of the feedstock, while costs of biodiesel sank in view of diminishing demand for the Chinese supply.

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

Prices of hydrotreated grease, or HVO, a primary kind of biodiesel, have actually halved versus in 2015's average to the present $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 cut their operations to an all-time low of under 20% of existing capacity 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 soared by two-thirds year-on-year in the first half of 2024 to 1.41 million lots, with the United States, Singapore and the Netherlands the leading destinations.

OUTLETS

While numerous smaller plants are likely to shutter production forever, larger manufacturers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring brand-new outlets including the marine fuel market in the house and in the important center of Singapore, which is utilizing more biodiesel for ship fuel mixing, according to the biofuel executives.

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

Companies would likewise accelerate preparation and building of sustainable air travel fuel (SAF) plants, executives stated. China is expected to reveal an SAF mandate before the end of 2024.

They have actually likewise been searching for brand-new biodiesel clients outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are local mandates for the alternative fuel, the officials included.

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