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 most significant buyer, dries up ahead of anti-dumping tariffs, biofuel executives and analysts said.

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

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

Exports to the bloc have actually fallen greatly since mid-2023 amidst investigations. Volumes in the very first six months of this year plunged 51% from a year previously to 567,440 heaps, Chinese custom-mades data revealed.

June shipments shrank to just over 50,000 tons, the lowest 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 top importer in 2023, taking in 84% of China's biodiesel shipments to the EU, followed by Belgium and Spain, Chinese customizeds figures revealed.

Chinese producers of biodiesel have actually delighted in fat earnings in current years, maximizing the EU's green energy policy that gives aids to companies that are utilizing biodiesel as a sustainable transportation fuel such as Repsol, Shell and Neste.

Much of China's biodiesel producers 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 items like soaps and processing leather products.

However, the boom was temporary. The EU started in August last year examining Indonesian biodiesel that was believed of preventing 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 undercutting local producers.

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

"With hefty prices of UCO partly supported by strong U.S. and European need, and free-falling product prices, business are having a bumpy ride surviving," stated Gary Shan, primary marketing officer of Henan Junheng.

Prices of hydrotreated grease, or HVO, a main type of biodiesel, have cut in half versus last year's average to the current $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 cut their operations to a lowest level of under 20% of existing capability typically 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 analysts forecast are set to touch a new high this year. UCO exports skyrocketed by two-thirds year-on-year in the 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 forever, larger producers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring new outlets consisting of the marine fuel market in your home and in the crucial center 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 use 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 mandate before completion of 2024.

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

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