By Chen Aizhu

SINGAPORE, Aug 16 (Reuters) - Chinese biodiesel manufacturers are seeking 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 experts said.

The EU will enforce provisional anti-dumping responsibilities of 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 company that deserved $2.3 billion in 2015.

Some bigger producers are considering the marine fuel market in China and Singapore, the world's leading 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 sharply given that mid-2023 amid examinations. Volumes in the very first six months of this year plunged 51% from a year previously to 567,440 lots, Chinese customizeds data revealed.

June deliveries shrank to simply over 50,000 lots, the most affordable considering that mid-2019, according to customs data.

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 custom-mades figures showed.

Chinese producers of biodiesel have taken pleasure in fat earnings recently, making the most of the EU's green energy policy that gives aids to business that are utilizing biodiesel as a sustainable transport fuel such as Repsol, Shell and Neste.

Many of China's biodiesel manufacturers are privately-run little plants utilizing scores of workers processing waste oil gathered from countless Chinese dining establishments. Before the biodiesel export boom, they were making lower-value goods like soaps and processing leather items.

However, the boom was short-term. The EU started in August last year investigating Indonesian biodiesel that was suspected of circumventing duties by going through China and Britain, followed by a 14-month anti-dumping probe into Chinese biodiesel believed to be priced synthetically low and undercutting local manufacturers.

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

"With large prices of UCO partially supported by strong U.S. and European need, and free-falling item costs, business are having a hard time enduring," said Gary Shan, primary marketing officer of Henan Junheng.

Prices of hydrotreated grease, or HVO, a primary kind of biodiesel, have actually 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 actually cut their operations to an all-time low 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 improving China's UCO exports, which experts 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 heaps, with the United States, Singapore and the Netherlands the leading locations.

OUTLETS

While lots of smaller plants are most likely to shutter production forever, larger manufacturers like Zhejiang Jiaao, Leoking Enviro Group and Longyan Zhuoyue are exploring brand-new outlets consisting of 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.

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

Companies would also accelerate preparation and structure of sustainable air travel fuel (SAF) plants, executives said. China is anticipated to announce an SAF mandate before the end of 2024.

They have also 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 included.

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