By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel manufacturers are looking for 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 said.

The EU will impose provisional anti-dumping responsibilities 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 company that was worth $2.3 billion last year.

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

Exports to the bloc have fallen greatly considering that mid-2023 amidst investigations. Volumes in the very first six months of this year plunged 51% from a year earlier to 567,440 loads, Chinese customs information revealed.

June shipments shrank to just over 50,000 loads, the lowest because mid-2019, according to custom-mades 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 top importer in 2023, taking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese customs figures revealed.

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

Much of China's biodiesel manufacturers are privately-run small plants utilizing scores of workers 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 products.

However, the boom was temporary. The EU began in August last year examining Indonesian biodiesel that was presumed of circumventing 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 damaging regional producers.

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

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

Prices of hydrotreated veggie oil, or HVO, a main type of biodiesel, have halved versus in 2015's average to the present $1,200 to $1,300 per metric load and are off a peak of $3,000 in 2022, Shan added.

With low costs, biodiesel plants have actually cut their operations to an all-time low 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 improving China's UCO exports, which analysts forecast 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 tons, with the United States, Singapore and the Netherlands the top locations.

OUTLETS

While lots of smaller plants are likely to shutter production indefinitely, bigger 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 blending, according to the biofuel executives.

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

Companies would likewise speed up preparation and building of sustainable air travel fuel (SAF) plants, executives said. China is expected to reveal an SAF required before completion of 2024.

They have actually likewise been hunting for new biodiesel clients outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are local requireds for the alternative fuel, the officials added.

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