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 greatest purchaser, dries up ahead of anti-dumping tariffs, biofuel executives and experts stated.

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

Some bigger producers 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 said.

Exports to the bloc have fallen greatly given that mid-2023 amidst investigations. Volumes in the very first 6 months of this year plunged 51% from a year earlier to 567,440 tons, Chinese custom-mades information revealed.

June deliveries shrank to simply over 50,000 heaps, the least expensive considering that mid-2019, according to custom-mades information.

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 leading importer in 2023, taking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese customs figures revealed.

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

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

However, the boom was short-term. The EU started in August last year investigating 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 thought to be priced synthetically low and damaging regional manufacturers.

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

"With substantial rates of UCO partially supported by strong U.S. and European demand, and free-falling product rates, companies are having a difficult time surviving," said Gary Shan, primary marketing of Henan Junheng.

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

With low costs, biodiesel plants have 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 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 lots of smaller plants are most likely to shutter production indefinitely, larger manufacturers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are checking out brand-new outlets including the marine fuel market in the house and in the important hub of Singapore, which is utilizing more biodiesel for ship fuel blending, according to the biofuel executives.

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

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

They have actually also been scouting for new biodiesel customers outside the EU bloc, in Australia, Japan, South Korea and Southeast Asia where there are local mandates for the alternative fuel, the authorities included.

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