Your Biofuels Supplier

Solfuels is here to assist you with your Biofuels requirements. We have an in-depth knowledge of the biofuels industry and particularly Biodiesel across geographies and feedstocks. We also undertake production agreements to satisfy the needs of our customers and for this purpose can guarantee continuous flows of our products. We differentiate ourselves from other traders by providing our customers and partners a high level of service, transparency and a global scope. This includes intelligence on Biofuels movement worldwide, risk management strategies and regulatory insights.

 

 

 

 

 

 

 

 

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Mon 22Oct2018: Gasoil moves a bit higher at $716 as backwardation to Apr19 widens to +$14/mt. Heat crack margin also moves higher to $28.45 telling us something is up as Nov WTI futures expires signalling end of a weakening trend. US Biodiesel still marred by poor margins despite increase in HO but D4 RINs following depressed state of ethanol RINs as impact of E15 weighs on market. 15 days to midterms that will set the tone for RVO (Renewable Volume Obligations) by end of Nov. In EU, situation with Rhine river causing logistical nightmare for supply chain of all refined products. RED RME spot has gone to +500 while Q4 offered at +405 and spread over RED FAME now 240/mt. Crop progress shows that we just went over the hump on Soya with 53% harvested; now storage for the remainder of this crop will be critical and would expect continued pressure on basis and then futures. BOGO ended today at -69/mt while POGO at -$161 and expect continued pressure on both despite exceptional arbitrage into EU. On the forex front, we are probably not too fare for CNH to reach 7 while Indian Rupee still vulnerable to Crude prices. In South America, the Brazilian Real is defying all expectations of emerging markets with a strong rebound to 3.67 ahead of elections next week end.

  https://www.hellenicshippingnews.com/record-low-rhine-levels-bring-widespread-disruption-across-energy-and-commodities/

Fri 19Oct2018: Gasoil trends down to $712 with backwardation widening quite a bit for spot to almost $5/MT while x/j spread has widened $4/mt to $12.25/mt at the same time as Heating oil crack has exploded today to almost $28/Brl. Refiners are cracking for diesel as gasoline crack barely hovers $10/brl. No sign of increasing maintenance in US either meaning that margin are simply too attractive despite fact that both WTI and Brent crude have turned into a nearby spot contango and almost flat through April. In US Biodiesel, margins have disappeared as BOHO has narrowed close to 10 cents per gallon while D4 RINs remains at a paltry 32.5 cpg which is artificially depressed because of E15 and continued Trump administration assaults on RFS. In EU, as expected with strengthening BOGO, we are seeing premiums on FAME come back to +190 on the Spot and +165 for Q4. RME remains difficult to find at less than +235 premium Vs FAME for Q4. POGO has strengthened following moves by Indonesia to increase biodiesel blend but with continued weakness in Bean oil, difficult to see the light quite yet as only 47% of US Soy crop harvested. Yuan made a record low at 6.9411 and probably next stop is back to 7 while in India the rupee recovered to 73.33 late on Friday – the world now marches towards full Iran sanctions in 2 weeks.

Mon 15Oct2018: Gasoil retrenches to $715 despite lots of volatility and RSI stabilises around 61 after Hurricane damage assessment to Gulf platform practically nil while on-land damage much more serious but did not affect oil trend. However, geopolitical hurricanes are swirling-about and difficult to see how we can break $700 on downside despite Equity-market setback and Heating Oil crack at $25.95/Brl while Canadian crude being discounted heavily Vs WTI helping US refineries curtail imports. Maintenance season not suiting strong distillate demand +8.2% y-o-y, interestingly gasoline demand was -2.6% y-o-y. EU Biodiesel was pretty quite last week following the Argus London Biofuels conference where generally the mood was buoyant with increasing mandates across the board from 7 to 10% in EU under RED2 but a lot of anxiety remains over Argentina SME imports. It should be noted that Biodiesel demand has been strong all year in EU being led by Eastern Europe members who are playing catch up to meet existing biodiesel mandates. EU FAME showing +160 for Q4 still while RME showing +390 or a $230/MT premium difference – definitely a luxury fuel! Meanwhile in US, RINs should be well supported today as BOGO $10/MT stronger @-$55 while POGO follows -$155 as Indonesia pushes for higher domestic biodiesel blend to curtail distillate imports. China RMB remains weak at 6.93 while India Rupee is still under pressure at 73.80 as oil imports is stressing forex.

Wed 10Oct2018: Gasoil at $738.75 front month after a brief rally on Monday on account of Hurricane Michael – Traders now worried about Florida demand being cutoff and accumulating stocks of distillate with such strong Heat crack margin of now $27.20/Brl. Gasoil backwardation widening today a bit signalling that this may be a bear trap. In EU Biodiesel, RME premium now at +322 over ICE gasoil spot with a widening spread to FAME of 155-165. Crushers in Europe are crushing soy instead of rape because of high soymeal demand, this is creating a tight pipeline for rapeseed oil that maybe with us until the end of the year. In US biodiesel, diesel flat prices has improved production margin once again as RINs stable around 33cpg despite the drop in Ethanol RINs that will probably percolate to D4. The next milestone in US will be RVOs at end of November and talk is that EPA is unlikely to increase Biodiesel mandate to compensate Small Refinery Exemptions. CNH reaches 6.93 and INR 74.25 indicating continued $ strength but this also will increase domestic input costs & eventually hurt import volume in these huge Asian economies and any small GDP downticks will have big impact on rest of the world.

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