A new biodiesel law in Argentina which cuts the diesel blend mandate by 5% could push up global soyabean prices, The Rio Times reported on 20 July.
The newly-approved biofuels bill reduced the biodiesel mix in diesel fuel from 10% to 5%, and gave the Energy Secretariat the flexibility to increase the blending mandate or reduce it to as low as 3%, depending on market conditions, according to an AgriCensus report on 16 July.
Allowing a reduction in the amount of soya-based biofuel to be blended into diesel for domestic consumption could lead to a rise in soyabean oil exports, driving down international prices for the product, according to The Rio Times.
“Reducing the volume of biodiesel used in fuels locally will decrease consumption of soyabean oil in Argentina. Then we will have more soyabean oil to be exported. This can impact international prices, considering the large share of the international market that Argentina has,” CIARA-CEC agro exporters chamber head Gustavo Idígoras was quoted as saying.
With the previous 10% blend, Argentina consumed about 1M tonnes/year of biodiesel to be mixed with diesel. However, with the new measure, this volume could be halved, according to Luis Zubizarreta, the president of biofuels industry chamber Carbio.
The bill stipulates that the new biodiesel regulation will be valid until the end of 2030, according to the AgriCensus report.
Meanwhile, the bioethanol mandate would remain at 12%, AgriCensus wrote, with the Energy Secretariat also able to increase or reduce that level depending on market conditions.