[RE]fuel Report Market Commentary

A further bout of pressure came to RTFC prices at the end of the week, with trades heard done in the region of 20p for Year 10, and bids retreating to levels around 19.5p for both Year 10 and Year 11.

With offers also chasing down values to occupy levels close to last week’s assessment, prices had demonstrably moved lower and the Census Year 10 and Year 11 assessments reflected those changes – Year 10 assessed at 20.2p and Year 11 assessed at 20.3p.

While that remained in part a reflection of ongoing blending appetite and limited incentive to buy, market participants also commented on mounting concerns that, with the end of 2017 now in sight, there seemed to have been little progress made towards enshrining the changes proposed to the RTFO back in September into UK law.

With the April 1, 2018 deadline looking increasingly tight one source voiced fears that any further delay could spell a collapse in RTFC prices.

“There is a certain nervousness… A lot of people are holding back [from trading] and any delay could make the RTFC prices collapse,” one market source said, adding “most people are blending; RME prices are coming down and gasoil is coming up.”

Of the wider energy market, a respite on the cold weather had seen RME prices ease along with those of energy, while UCOME prices have continued to face pressure.

Most biodiesel blenders are said to be focused on taking RME and UCOME into their final mix, with a potential return to cold weather seeing RME prices pick up marginally versus last week, but still well done from the $1,040/mt seen November 17.