U.S. Biodiesel Imports Doubled in 2023 Due to Low Prices in Europe: EIA

U.S. biodiesel imports increased twofold during 2023 compared to 2022 and were recorded at 33,000 barrels per day (b/d), according to a May 28 report published by the U.S. Energy Information Administration. Moreover, U.S. biodiesel imports continued to increase in the first two months of 2024. Majority of the biodiesel imports come from Germany, whereas the residual increase comes from other parts of Europe, where a biodiesel excess has depressed prices.

U.S. biodiesel imports averaged 12,000 b/d between September 2017 and October 2022. The U.S. Renewable Fuel Standard program reinforces biodiesel demand in the U.S. As the program has developed, biofuel blending obligations have gradually risen and led to higher biodiesel usage, imports and production. During 2013 and 2017, 27,000 b/d of biodiesel was imported yearly by the U.S. due to subsidized biodiesel from Argentina and Indonesia. The U.S. Department of Commerce and International Trade Commission started trade investigations in April 2017 that led to antidumping duty and countervailing duty orders that placed taxes on biodiesel imports from these countries to counterbalance the impacts of these subsidies. Following the investigation, U.S. biodiesel imports declined significantly.

In February 2023 the U.S. imported 54,000 b/d of biodiesel, the most for any month since June 2017. U.S. biodiesel imports have risen on the back of weaker biodiesel prices in the EU, which has given U.S. importers a financial incentive to import. The decline in European biodiesel prices can be attributed to policies associated with the EU’s Renewable Energy Directive. Moreover, higher European imports of biodiesel from China, rising renewable diesel usage in replacement of biodiesel to fulfil EU blending targets and lower biofuel targets have led to lower biodiesel prices in the EU.

Majority of the U.S. biodiesel imports came from Germany. U.S. biodiesel imports from Germany increased twofold to 11,000 b/d from 2022 to 2023, making it the leading importer for U.S. biodiesel. The remaining rise in U.S. biodiesel imports came from Spain, Italy and Belgium with marginal rises coming from Brazil and South Korea.

U.S. biodiesel production rose by 5 percent during 2023, despite higher imports and rising competition from the production of renewable diesel.  The agency projects U.S. biodiesel production to decline during 2024, due to expectations that blending margins will be lower than in 2023.