By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel manufacturers are looking for new outlets in Asia for their exports and checking out producing other biofuels as supply to the European Union, their greatest 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 producers Zhejiang Jiaao, Henan Junheng and Longyan Zhuoyue Group in an export service that was worth $2.3 billion in 2015.

Some larger manufacturers are eyeing the marine fuel market in China and Singapore, the world's top marine fuel center, as they seek to balance out currently falling biodiesel exports to the EU, biofuel executives stated.

Exports to the bloc have fallen sharply 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 heaps, Chinese customs information revealed.

June deliveries shrank to simply over 50,000 loads, the lowest given that mid-2019, according to customizeds information.

At their peak, exports to the EU reached a record 1.8 million tons in 2023, representing 90% of all Chinese biodiesel exports that year. The Netherlands was the top importer in 2023, soaking in 84% of China's biodiesel deliveries to the EU, followed by Belgium and Spain, Chinese customs figures showed.

Chinese producers of biodiesel have actually enjoyed fat revenues recently, taking advantage of the EU's green energy policy that gives subsidies to companies that are utilizing biodiesel as a sustainable transportation fuel such as Repsol, Shell and Neste.

Many of China's biodiesel manufacturers are privately-run small plants employing scores of employees processing waste oil gathered 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-lived. The EU started in August last year examining Indonesian biodiesel that was suspected of circumventing responsibilities 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 local producers.

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

"With significant rates of UCO partially supported by strong U.S. and European need, and free-falling product prices, companies are having a difficult time surviving," stated Gary Shan, chief marketing officer of Henan Junheng.

Prices of hydrotreated vegetable oil, or HVO, a main kind of biodiesel, have cut in half versus last year's average to the current $1,200 to $1,300 per metric load and are off a peak of $3,000 in 2022, Shan included.

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, down from a peak of 50% last seen in early 2023, according to Chinese consultancies Sublime China Information and JLC.

Meanwhile, shrinking biodiesel sales are boosting China's UCO exports, which analysts anticipate are set to touch a 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 lots of smaller plants are most likely to shutter production forever, bigger manufacturers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring new outlets including the marine fuel market in your home and in the crucial center of Singapore, which is using more biodiesel for ship fuel mixing, according to the biofuel executives.

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

Companies would also accelerate planning and structure of sustainable aviation fuel (SAF) plants, executives said. China is anticipated to reveal an SAF required before completion of 2024.

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

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