By Chen Aizhu

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

The EU will enforce provisional anti-dumping tasks of between 12.8% and 36.4% on Chinese biodiesel from Friday, striking over 40 companies including leading manufacturers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export business that was worth $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 seek to balance out currently falling biodiesel exports to the EU, biofuel executives stated.

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

June deliveries shrank to just over 50,000 heaps, the least expensive considering that mid-2019, according to customizeds 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, soaking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese customizeds figures showed.

Chinese producers of biodiesel have taken pleasure in fat profits recently, maximizing 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.

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

However, the boom was short-term. The EU started in August in 2015 examining Indonesian biodiesel that was thought of circumventing responsibilities 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 regional producers.

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

"With significant costs of UCO partially supported by strong U.S. and European demand, and free-falling item rates, companies are having a difficult time enduring," said Gary Shan, chief marketing officer of Henan Junheng.

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

With low prices, 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 enhancing 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 heaps, with the United States, Singapore and the Netherlands the top destinations.

OUTLETS

While many smaller plants are likely to shutter production forever, bigger producers 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 essential center 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 likewise speed up planning and building of sustainable aviation fuel (SAF) plants, executives stated. China is expected 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 local mandates for the alternative fuel, the authorities added.

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