The industry of Argentine biodiesel is having a particularly weak year, with a start marked by falls in activity and an external demand that has yet to take off. In the first half of the year, cumulative production was 445.983 tonnes , a level not seen since 2009, when this business was just taking off.
Local consumption has partially cushioned the blow thanks to the mandatory diesel mix, but shipments abroad have been reduced to minimum thresholds. The combination of meager exports, lower price attractiveness in Europe and restrictions in the US leave installed capacity with very high levels of idleness.
Production, domestic market and exports
After a very lukewarm start, June showed a small respite with 105.253 tons, the best figure in ten months. Although there has been some recovery, half-year activity remains moderate despite the entry of the new soybean harvest to the industrial circuit.
El local market stood the test: the sales by the cut reached 384.326 tons, being the highest volume since 2020 for the first half of the year, although still far from pre-2020 records. The mandatory mix of 7,5% in diesel ensures a base demand, although the SME sector complaint occasional breaches and price mismatches contrary to what is stipulated by the regulations.
Outside the country, the situation worsens: exports are located around 30.000 tonnes in the semester, the lowest level since 2008. The European Union maintains an irregular demand and uncompetitive prices, while United States remains closed to Argentine biodiesel due to tariff measures and a strong commitment to domestic production.
In Asia, China is not listed as a destination of Argentine biodiesel; its interest lies in the soybean to process it locally and supply its meat chain. In addition, the high international demand for Argentine soybean oil limits the availability of raw materials for processing into biodiesel and exporting it.
Private estimates indicate that if conditions remain stable in the second half of the year, Annual production could be around 950.000 tons. However, this volume remains modest compared to the country's potential.
Prices, capacity and provincial map
In August, the Ministry of Energy set a Minimum price of biodiesel of 1.354.507 pesos per tonBioethanol prices have also been updated: $824,044/l for sugarcane y $755,258/l for corn. This new price It remains in place during August and until its next review..
There is a significant gap between what could occur and what is actually manufactured. The theoretical annual capacity is around 4,6 billion tons, so even achieving the 950.000 tonnes Dear, the idleness would be close to 80%., according to market reports.
Santa Fe continues to be the epicenter Argentine biodiesel. However, in the first half of the year, its share of national production fell to 49%., well below the 70% or more of previous years. This drop primarily affects plants oriented to exporting .
In the domestic market, the sales assigned in the first half of the year totaled 172.838 tonnes , showing a slight increase compared to the same period of the previous year. Despite this, limited percentage of mixing reduces growth opportunities in the domestic channel.
La installed capacity It is mainly concentrated in Santa Fe, where it is estimated that the majority of the national productive park operates. Businessmen in the sector warn about a extremely high idleness and the need for clear rules both in Prices and the compliance with the cuts.
Likewise, they have been announced industrial conversion projects in San Lorenzo linked to the production of Sustainable Aviation Fuels (SAF), driven by YPF and other partners. They are managed investments worth hundreds of millions of dollars, which could revitalize the region's refining and biofuels hub.
In regulatory matters, SME biodiesel entities have presented administrative and judicial claims in the face of alleged imbalances in the pricing formula and by breaches of the cut at various stages of the production chain. The sector maintains that strict enforcement of regulations would be key to increasing the utilization of installed capacity and employment.
At the international level, the joint production of biodiesel and HVO (hydrotreated vegetable oil) for this year is estimated at approximately 61,9 billion tons, showing a slight decrease compared to the previous year. The reduction is due to lower volumes in United States, EU-27, Canada and Argentina, although Brazil and Indonesia continue to see strong growth due to their mandatory shorts.
The main destinations remain the European Union y EE. UUThe EU, although still a key market, has prices and conditions that have yet to be fully finalized; the US maintains tariff barriers that limit the competitiveness of Argentine biodiesel and strengthen its domestic production; while China prioritizes grain imports for internal processing and local supply.
At the close of this analysis, market difficulties, declining foreign sales, and production capacity slack mean that the future of Argentine biodiesel depends on improved export price differentials, strict compliance with blending regulations, and the consolidation of new investments that can reduce the extremely high slack plaguing the sector.
