China's biodiesel imports increased in April 2019, as domestic demand moved up and the supply turned tight.
China imported 38,669.1 mt of biodiesel (HS Code: 38260000) in April 2019, a rise of 194.2% month on month, according to data released by the General Administration of Customs.
Chinese importers imported more biodiesel as international crude prices rose in April. In addition, diesel demand increased in several areas, where harvesting season created additional demand. Moreover, domestic producers recorded limited utilization rates, leading to tight biodiesel supply.
Biodiesel imports mainly came from Indonesia and Hong Kong, with 34,455.39 mt and 4,010.9 mt for each. Biodiesel imports from the two sources were exempted from consumption tax and 6.5% tariffs, saving almost CNY1,000 of costs for traders.
Meanwhile, China exported 68,555.68 mt of biodiesel (HS Code: 38260000) in April, a rise of 112.8% month on month, GAC data showed.
Crude prices fell at the end of May 2019, and as a result, oil traders might show limited interest in buying biodiesel due to limited blended diesel demand this month. However, there will be fair demand for biodiesel in the petrochemical industry. Hence, biodiesel imports are expected to inch up in May.
Going forward, international crude prices could remain subdued in June 2019. Meanwhile, the demand for biodiesel in crude blending might decline as overall diesel demand could slow due to rising temperatures. While the demand for chemical-use biodiesel is expected to remain stable. Hence, biodiesel imports might inch lower in June.
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