Glycerine Market Report

IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII

December 2020 / N°131

The Market Intelligence To Sharpen Your Performance

A quarterly publication of the Group since 1986.
 TABLE OF CONTENTS

Slide 3 EXECUTIVE SUMMARY

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Slide 6 PART 1 : THE US GLYCERINE MARKET

Slide 17 PART 2 : THE EUROPEAN GLYCERINE MARKET

Slide 28 PART 3 : THE INTERNATIONAL GLYCERINE MARKET

Slide 36 CONCLUSION

This Quarterly Glycerine Report is published successively in The report analyses the glycerine market by region during the latest
magazine format (in March and September) and quarter completed and offers an outlook for the remainder of the
in Powerpoint format (June and December). year, along with the data for the past 10 years.
 EXECUTIVE SUMMARY: QIII / July – September 2020

Glycerine price gains scored during QII were lost during QIII. By August, European and US
prices returned to where they were before March, ie. fairly low levels.

December 2020 Oleoline Glycerine Market Report / Issue N° 131

The glycerine supply situation improved at the beginning of the second half of the year.
Biodiesel profitability improved a little thanks to better diesel values. Vegetable oil costs
remain high. Soya bean oil has gained market share this year, attracting more attention on
KEY QIII sustainability issues. Glycerine prices had to come down quickly to keep the by-product
moving.
MARKET
The most striking aspect of glycerine consumption during July, August and September has
POINTS been the continued absence of demand from China. Importers maintained their opinions
that prices were too inflated to purchase large volumes of either crude or refined glycerine.
QIII imports of glycerine into China were the lowest in 2 years.
A new wave of lockdowns in December triggered the start of a new cycle of glycerine price
increases in many markets.

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 EXECUTIVE SUMMARY

TABLE I: Short Term View of glycerine Prices, Dec 2020 to Mid 2021

December 2020 Oleoline Glycerine Market Report / Issue N° 131

USA Europe China Est. for USA Est. for Europe Est. for China
CIF in bulk in
PRODUCT
Delivered in bulk Delivered in bulk flexibags Mid 2021 Mid 2021 Mid 2021
Decem ber 2020 Decem ber 2020 Decem ber 2020

99.7% kosher quality

38 c/lb. EUR 650 pmt USD 670 pmt Forecast 45 c/lb. EUR 575 pmt USD 550 pmt
refined glycerine spot price

99.5% technical quality

35 c/lb. EUR 520 pmt USD 600 pmt 38 c/lb. EUR 475 pmt USD 475 pmt
refined glycerine spot price

80% crude glycerine for refining

10 c/lb. EUR 395 pmt USD 350 pmt 12 c/lb. EUR 330 pmt USD 300 pmt
spot price

NB: Spot prices are defined as an average level of sales made during the captioned month in bulk, delivered customer. Estimates based
on exchange rate: € 1 = $ 1.21. European prices for crude glycerine for refining are the non-GMO kosher quality, Chinese prices are
CIF Chinese Main Ports in bulk in flexibags.

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 THE NORTH AMERICAN (NA)
GLYCERINE MARKET

December 2020 Oleoline Glycerine Market Report / Issue N° 131

PART
1

As from this report, the first chapter will include

Mexico, the USA, Canada
 1 NA Market Summary/QIII 2020
TABLE II: NA glycerine production to consumption bridge
July - September 2020 (‘000 mt) QIII glycerine
Producers had
generation is
to dig into
the highest of

December 2020 Oleoline Glycerine Market Report / Issue N° 131

inventories,
2020.
especially of
US biodiesel
CG, to respond
subsidies have
to demand
boosted sales.

Imports soared Consumption

25% above QII to has been
catch up on late surprisingly
contracts, chiefly
robust and
RG from Europe
absorbed this
into Mexico and
from South-East
increase in
+ - + = supply
Asia into the USA
CG 70 1 3 -10 59 CG is crude glycerine, calculated basis 100%,
RG is anything which has more than 99.5% glycerine content.
RG 123 70 1 -5 188 Decimal figures are rounded up to the closest unit.
Source: HBI Databases

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 1 North American Glycerine Production: QIII 2020
TABLE III: NA glycerine production by industry (‘000 mt)

Glycerine generation, by industry Q3 2020 in mt

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Biodiesel/Methyl esters 167
Fatty acids 23
Fatty alcohols 4
Soap 1
Total 195
Source: HBI estimates and EPA, EMTS, EIA data for biodiesel.

 US biodiesel production has increased by 6% during QIII 2020 compared with QIII 2019. Renewable diesel (HVO) sales
were limited to 15% market share. Massive subsidies were in place during this election year: USD 300 pmt federal tax
credit plus RIN paper tickets with values of almost USD 1 per gallon (USD 0.54 a year ago).
 The North American oleochemical industry, using mostly tallow has defended market share, helped by soaring palm
prices which disadvantages imports.
 195,000 mt of glycerine were produced during QIII 2020, over two thirds as refined glycerine - an increase on previous
ratios
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 1 NA Production: Outlook
TABLE IV: NA glycerine production:
An excellent year for US biodiesel sales in 2020 despite
2010-2020 est. (‘000 mt)
expensive raw materials sets the tune for 2021 with US
biofuel regulations not expected to change. The Biden Year Production Index

December 2020 Oleoline Glycerine Market Report / Issue N° 131

administration is seen as biofuel friendly. Renewable diesel 2010 245 100
(HVO) production is set to constitute a growing menace to
2011 504 206
first generation biodiesel producers.
2012 501 204
2013 657 268
Glycerine consumers are minimizing risks by buying from 2014 577 236
local suppliers rather than importers. Additional domestic 2015 566 231
distillation capacity has been used, increasing refined 2016 642 262
glycerine production. 2017 656 268
2018 742 303

QIV glycerine production is expected slightly lower, just below 2019 711 290
180,000 mt each. 2020 est. 745 304
Sources: US Bureau of the Census, EPA EMTS and EIA Data,
HBI estimates. Index 100 in 2010. Data before 2020 is only US
production
Total estimated glycerine production for 2020: 745,000 mt.
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 1 NA Consumption QIII 2020

TABLE V: NA estimated glycerine consumption ‘000 mt

New building is increasing

December 2020 Oleoline Glycerine Market Report / Issue N° 131

rapidly. There is a shortage of
Mexico +
USA
Canada
Total NA second hand cars. These
trends are positive for
Crude glycerine 55 5 60
glycerine use in polyols and
polyurethanes which account
Refined glycerine 158 30 188
for over 10% of US useage.
TOTAL 213 35 248
Source: HBI
The competition for crude
The good health and strong demand of the North American economies, glycerine between historical
although hard-hit by the pandemic, is astonishing. Only the mineral oil consumers in animal feed
production industry is lagging behind, along with catering and tourism. and waste water treatment
Household goods and cleaning products have been doing especially well. and domestic refiners has
Could it be in the best interest of the economy and the stock market to lock intensified. Potential exports
North American consumers inside their houses? are an additional outlet

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 1 North American Consumption: 2020 Outlook

TABLE VI: NA glycerine useage: 2010 - 2020 est. (‘000 mt)

Consumed Consumed

December 2020 Oleoline Glycerine Market Report / Issue N° 131

QIV 2020 glycerine consumption ought to be
Year as Refined as Crude TOTAL
211 000 mt, with about 20% in the form of crude glycerine
Glycerine Glycerine and 80% as refined glycerine.
2010 251 180 431
2011 336 285 621
2012 451 283 734
Price ranges have been sufficiently large to allow refined
2013 467 354 821
glycerine to remain competitive in most applications,
2014 473 361 834
2015 513 298 811
including in technical applications such as polyols and MPG
2016 589 243 832
2017 592 272 864
2018 625 265 890 Overall North American consumption of glycerine in 2020
2019 630 272 902
will reach 919 000 mt, with an increase of consumption of
2020 est. 694 225 919
refined glycerine more than compensating lower crude
Sources: US Bureau of the Census, US Department of Commerce, EPA EMTS, EIA
Data, HBI estimates. glycerine useage.
The figures in this table are calculated using opening stocks of glycerine, adding
production and imports, deducting exports and closing stocks to arrive at a domestic
consumption figure.

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 1 Imports & Exports
TABLE VIII: Refined Glycerine imports GRAPH : US Glycerine imports and exports 2010-2020 est. (‘000 mt)
2010-2020 est. (‘000 mt)
Imports in '000 mt
218 219

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Year Market
Volume Index 171 173
164 160
share % 153 148
2010 139 221 69* 139 138 137

2011 171 271 40*

2012 138 219 34* 91
2013 153 243 36*
61
2014 218 346 37* 43 48 43
33 35
2015 173 275 34* 28 26
19 18
2016 138 219 26*
2017 148 235 26*
2018 164 260 27*
2019 160 254 27* Imports Exports
2020 est. 217 345 32*
* Refined glycerine only. Data includes Note: Crude glycerine volumes are included in this graph (2k mt imported in 2020). Source: US Dept. of Commerce
Mexico and Canada as from 2020
Source: US Dept. of Commerce

A drop in imports during the first half of 2020 was followed by a wave of incoming glycerine, namely 70,000 mt from
South-East Asia into the USA during QIII. It would be surprising to see QIV volumes at the same level, as availability is
limited from Malaysia and Indonesia and has practically dried up from Argentina.

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 1 Glycerine inventories
GRAPH I: NA inventory levels from domestic production – 2010-2020 est.
in '000 mt
120

December 2020 Oleoline Glycerine Market Report / Issue N° 131

100

80

60

40

20

Source: HBI
Refined Glycerine Stocks Crude Glycerine Stocks
Biodiesel producers have contracted longer term as from
Production increased during QIII, mechanically
QIII. Stocks are expected to return to their average of
pushing up domestic producers’ glycerine
about 2 weeks’ production at most operators, with a few
inventories at the end of September.
large exceptions storing important quantities.
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 1 Refined Glycerine prices: from QIII 2020
GRAPH II: NA refined glycerine spot prices (c/lb delivered in bulk) The combination of high domestic
production and significant imports has
caused glycerine supply to outstrip
demand for much of QIII.

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Pharma grade RG prices declined during
July and August and stabilized since, just
above 38ct/lb delivered customer in
bulk

A premium of about 5 c/lb for pharma

grade material over technical quality
has been respected. Good quality 80%
CG prices have started to soar in
December, a usual indicator that RG
prices will follow.

South American and South-East Asian

refined glycerine is sold in the range of
USD 700 – 750 pmt CIF US-Mexican
Source: Oleoline Weekly Refined Glycerine Report Ports in bulk in December
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 1 North American Glycerine Prices: Outlook

- A relatively cheap price cycle seems to be ending, with sustained good demand
successful in depleting inventories. CG prices have increased in December to above

December 2020 Oleoline Glycerine Market Report / Issue N° 131

10 c/lb delivered customer.

- Expectations are that QI 2021 prices will rise sharply as imports are needed to
sustain US consumption. Current North American market values are much lower
than international levels.

- Contracts could rapidely hit the 45-50 c/lb price range for the best quality Pharma
refined glycerine in bulk. The majority of the volume is expected to continue
trading in between 32 and 40 ct/lb delivered customer in bulk.

- The average price by mid 2021 is expected to be 45 ct/lb delivered in trucks (USD
1000 pmt).

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 2
PART
THE EUROPEAN
GLYCERINE MARKET

December 2020 Oleoline Glycerine Market Report / Issue N° 131

 2 EU Market Summary
European – July – September
market summary - Q1 20192020
TABLE IX: European glycerine production to consumption bridge
It has not been A strong Euro
QIII 2020 (‘000 mt)
a good year for has favoured
biodiesel glycerine

December 2020 Oleoline Glycerine Market Report / Issue N° 131

production in imports from
Europe, with South-East Asia
the exception to the
of UCO-based detriment of
material. exports.

The CG usually exported to China

has been used in large volumes in
biogas in Northern Europe. Refined
glycerine consumption during QII
and QIII has been below par,
+ - especially for antifreeze production
+ =
in Eastern Europe. RG production
CG 137 6 23 3 123 has been on the low side.
RG 115 24 10 -5 124
Source: HBI Databases UCO: used cooking oils
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 2 European Production: QIII 2020
TABLE X: European glycerine production by industry (‘000 mt)

July - September 2020

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Fatty acids 31
Fatty alcohols (methanolysis) 14
Soap 1
Biodiesel 205
TOTAL 251
Source: HBI

 80% of the European glycerine arisings have been generated by biodiesel production during QIII 2020. Low
palm oil incorporation has handicapped Southern European producers in Spain for instance, usually producing
at full capacity during summer. Used-cooking oil based biodiesel producers have enjoyed running at full
capacity.
 Expensive palm oil costs have benefitted oleochemical production in Europe. Domestic soap, fatty acid and
fatty alcohols manufacture generated 46,000 mt of glycerine basis 100% during QIII.
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 2 European Production Outlook

TABLE XI: European glycerine production: 2010-2020 est. (‘000 mt)

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Year Production Index
Two months of There has been a 240 000 mt of
2010 1 112 100
production were major reshufle in raw glycerine are
2011 1 030 93
truncated during the materials, as palm oil expected to be
2012 1 002 90 European spring mostly priced itself generated during
2013 1 080 97 lockdown. A few out of the European the final quarter of
2014 1 130 102 producers also equation. An increase this year.
2015 997 90 declared Force in soy and canola oil Distillation
2016 989 89
Majeure. This results useage has meant capacities are
in the lowest annual that increasing being ramped up,
2017 985 89
glycerine output of volumes of European causing shortages
2018 1 001 90
the past 10 years in glycerine production of good quality
2019 1 048 94 Europe. are now GMO. crude glycerine.
2020 est. 945 85
Source: HBI

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 2 European Consumption: QI, QII and QIII 2020

A shift in biodiesel raw materials from

TABLE XII: European glycerine consumption: (‘000 mt) expensive palm and rape oils to cheaper

December 2020 Oleoline Glycerine Market Report / Issue N° 131

canola, soy and used-cooking oils
Jan - Sep 2019 Jan - Sep 2020 % explains a trend for increased
consumption of glycerine in crude form.
Crude glycerine 194 272 39,71% As a result the loss of sales in technical
Refined glycerine 503 418 -16,91%
applications has been limited.

TOTAL 697 690 -1,13%

Crude glycerine prices were more
attractive in many biogas applications
Source: HBI
than for local refining during QIII. The
232 000 mt consummed during this
period were about half in the form of
There has been a significant change in consumption in Europe,
crude and half in the form of refined
with refined glycerine useage decreasing and crude glycerine
glycerine.
demand for tel quel applications increasing by almost 40%
Part of QIII consumption was catching up
compared to the same period in 2019.
on delayed QII contracts.

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 2 European Consumption: full year view

TABLE XIII: European Glycerine consumption: 2010 - 2020 est. (‘000 mt)

Refined Crude Total Index 237,000 mt consumption of glycerine are

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Year
Glycerine Glycerine Consumption (RG*) expected during QIV 2020.
2010 510 479 989 222
2011 564 404 968 245
2012 606 393 999 263
As a result, European demand for glycerine
2013 538 423 961 234
in 2020 is anticipated to reach about
2014 558 413 971 243
950,000 mt including almost 600 000 mt of
2015 556 250 806 242
refined glycerine
2016 550 360 910 239
2017 576 336 912 250
This successful increase in consumption
2018 639 257 896 278
shows the agility of producers who have
2019 622 305 927 270
been able to compensate the loss of
2020 est. 597 358 955 259
demand of technical refined glycerine by
Source: HBI / NB: These figures do not include imports of glycerine sold by traders and overseas producers but
do include imports sold by European producers. increasing sales of crude glycerine.
2016 volumes have been restated as HBI’s databases have been reviewed
* RG : refined glycerine

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 2 European Imports & Exports
GRAPH III: European glycerine imports and exports since 2010
An exchange rate of Euro 1 = USD 1.2 has rebalanced
the European glycerine import and export dynamics.
in '000 mt

December 2020 Oleoline Glycerine Market Report / Issue N° 131

Exports have plummeted, especially for crude
297
glycerine during the first half of the year, as
259 263
domestic options have offered equivalent or better
239 prices to suppliers. European refined glycerine is
220
193
facing strong competition from South America and
179
170 164
South-East Asia. QIII and QIV exports are expected
139 around 33,000 mt each.
125
111 111 100
91
82
62 65 71
60
35 The trend of increasing imports of glycerine into
16
Europe, especially from South-East Asia, has been
suspended because of a lack of material. A few
opportunistic deals have occured, but not by
Imports Exports
exporters who intend to continue selling long term
in Europe. QIII imports are expected to reach 28,000
Source: HBI (Eurostats data for QIII 2020 not available at the time of publishing) mt and below 20,000 mt during QIV 2020.

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 2 European Glycerine Stocks
GRAPH IV: European inventory levels from domestic production – 2010-2020 est.
in '000 mt
180

December 2020 Oleoline Glycerine Market Report / Issue N° 131

160
140
120
100
80
60
40
20
0
Mar 10

Mar 14

Sep 15

Mar 17

Sep 18

Mar 20
Dec 10

Dec 11

Dec 12

Dec 14

Jun 16

Dec 17

Dec 20
Jun 19
Source: HBI

By the end of September 2020, glycerine stocks Crude glycerine stocks remain on the low side
were accumulating again, starting QIV at an however, a situation expected to last until the end
estimated 90 000 mt of 2020
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 2 Glycerine Prices: RG during Second half 2020
GRAPH V: European refined glycerine spot prices in € pmt delivered in bulk

Refined glycerine prices were forced to

adjust during the European summer as

December 2020 Oleoline Glycerine Market Report / Issue N° 131

declining demand on the spot market
combined with increased availability
compelled sellers to accept lower
values.

The premium for non GMO kosher

refined glycerine above technical grade
glycerine is Eur 50-85 pmt.

Glycerine prices are starting to increase

again, albeit not quite to the same
levels as during last Spring. In
December kosher non GMO RG is sold
around Eur 685 pmt delivered North
West European customer in bulk
Source: Oleoline Weekly Refined Glycerine Report

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 2 Glycerine Prices: CG during Second half 2020
GRAPH VI: European crude glycerine spot prices in € pmt delivered in bulk
European crude glycerine values
eroded during most of QIII and

December 2020 Oleoline Glycerine Market Report / Issue N° 131

€/pmt

550 bottomed out around the 15th of

500
September. They have regained
450
traction during QIV, although not quite
reaching the peak of last Spring.
400

350
Demand for non vegetable crude
300
glycerine has been especially good,
250 taking this segment to historically high
200 levels above Eur 220 pmt delivered in
150 bulk.
100
The kosher quality non-GMO kosher
crude glycerine was in low demand
during QIII as spot sales for refined
Europe Kosher and non GMO CG Europe 80% non vegetable CG
glycerine were sparse. Interest rallied
during QIV and prices increased almost
on a weekly basis, to Eur 400 pmt
Source: Oleoline Weekly Refined Glycerine Report
delivered in bulk early December.
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 market summary
2 European Market Outlook - Q1 2019
GRAPH VII: European glycerine production to consumption bridge
Glycerine
2020 est (‘000 mt) Source: HBI Databases Consumption
arisings are
of refined
expected to

December 2020 Oleoline Glycerine Market Report / Issue N° 131

glycerine has
remain solid
picked up
during QIV at
during QIV
241,000 mt,
and distillers
taking the
are trying to
total for the
obtain crude
year almost to
glycerine.
1 million mt.

The European market has

demonstrated in 2020 that it is not
dependent of exporting excess
+ - + = volumes to China. A balance has
been achieved by increasing
CG 389 34 67 3 358
consumption in biogas domestically.
RG 556 67 24 -2 597

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 2 Glycerine prices in Europe: Outlook

- The European market has been well balanced for most of 2020. QI and QIII
were moments of poor demand and decreasing or cheap prices, while QII

December 2020 Oleoline Glycerine Market Report / Issue N° 131

and QIV have seen restricted availability allow sellers to push for higher
values.
- The current QIV episode offers a price surge, albeit not as dramatic as last
Spring. In spite of efforts from sellers, there is little traction for contracts
above Eur 700 pmt delivered customer in bulk, including for the best quality
non GMO kosher pharma grade.

- This is no doubt good news for the European glycerine market. Too frequent
wild value swings would push customers away from the product. It seems
the European market has found a sustainable price ceiling, along with a floor
provided by good sales of crude glycerine into the biogas industry.

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27
THE INTERNATIONAL
GLYCERINE MARKET

December 2020 Oleoline Glycerine Market Report / Issue N° 131

PART
3
China, South America, South-East Asia
Argentina Malaysia
Brazil Indonesia
Colombia Philippines
Peru Thailand

2
 3 Biodiesel profitability – second half of 2020
GRAPH VIII: Soy and Palm Oil prices versus Mineral Oil Sustained demand from Asia
combined with poor weather and
difficulties in mobilizing workers have

December 2020 Oleoline Glycerine Market Report / Issue N° 131

kept vegetable oil prices high
throughout 2020.

Mineral oil values on the other hand

have been depressed by abundant
supply compared to current demand.

As a result, biodiesel mandates were

more expensive than ever to enforce.
As predicted by our reports earlier
this year, Indonesia, Argentina and
Brazil have all relaxed the obligations
and incorporated less than planned in
2020.
Source: Oleoline Biodiesel Report

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 3 Glycerine Supply from Brazil and Indonesia
BRAZIL INDONESIA

The biodiesel mandate was relaxed only The ambitious 2020 biodiesel
marginally. A B10 for September and mandate was largelly unfulfilled.

December 2020 Oleoline Glycerine Market Report / Issue N° 131

October and a B11 for November and B30 = about 9 million mt. Our
December replaced the planned B12 estimate, based on HBI’s databases,
is a production around 6.5 million mt
of biodiesel.
The total official production is 5.7
million mt of biodiesel for 2020 . An increasing amount of glycerine is
sold on long term contracts, leaving
the spot market frequently dry.
Large volumes of crude glycerine have
been withdrawn from the market to
Extra refining capacities mean South-
feed extra domestic distillation
East Asian glycerine distillers are now
capacities.
net buyers of crude glycerine

Brazilian and Indonesian biodiesel production are now similar in order of magnitude. However there remains more
glycerine coming out of Indonesia, courtesy of a larger oleochemical industry than that of Brazil. After robust growth for
the last two or three years, both countries are challenged to defend the market share they have recently conquered.
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 3 The Chinese Market: the end of a cycle?
GRAPH VII: Imports of glycerine into China, in mt, 2010 - 2020 est. There has not been
sufficent low
1 600 000 priced glycerine
available in the

December 2020 Oleoline Glycerine Market Report / Issue N° 131

1 400 000
market to fulfill
1 200 000
another year of
1 000 000 growth of Chinese
800 000 imports
600 000

400 000 China is expected

200 000
to import 1.2
million mt of
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2 018 2 019 2020 est
glycerine during
2020
Refined
Sources:glycerine
HBI, Chinese CustomsCrude glycerine basis 100%

In 2020, as during 2017, Chinese buyers have not been able to simply wait for excess glycerine to be offered to them.
They have had to compete with refiners in other regions of the world to get hold of good quality CG. RG imports
increased.
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 3 China RG prices: second half 2020
GRAPH IX: Chinese and South East-Asian glycerine spot prices (USD pmt) South-East Asian refined glycerine
prices were disconnected from
Chinese market level until June or
July. A lack of availability led Chinese

December 2020 Oleoline Glycerine Market Report / Issue N° 131

buyers to cover material from other
regions. Prices rallied as they touched
USD 450 pmt FOB
Malaysian/Indonesian Ports, and
started increasing in clear correlation
with Chinese levels.

95% min technical glycerine is made

from crude glycerine imported from
Brazil or Indonesia, and priced in
competition with RG imports from SEA

Refined glycerine prices seem to have

found balance after increasing by over
50% in 5 months to around USD 700
Source: Oleoline Weekly Refined Glycerine Report, pmt FOB SEA.
the 95% tech grade glycerine is produced domestically in China based on imported CG and includes value added taxes.

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 3 China CG prices: Second half of 2020
GRAPH X: Crude Glycerine spot import prices in USD pmt and
Value compared to the domestic price of 95% min tech RG. Crude glycerine prices in bulk in
flexibags have almost doubled in 5
months, ending just below USD 400

December 2020 Oleoline Glycerine Market Report / Issue N° 131

pmt CIF Chinese Main Ports in bulk

Crude glycerine is expensive compared

to refined glycerine, as CG value has
remained above 50% of RG value
since September

Buyers seem to have been shopping in

preparation for the Chinese New year
break and intend to step out of the
spot market at current high prices.

Source: Oleoline Two Weekly Crude Glycerine Report and Weekly Refined Glycerine Report. CG prices are for 80% min quality on a CIF
CMP basis and for non ASEAN origin material.

The highest CG price of 2020 was booked early December at USD 400 pmt CIF CMP in bulk for non ASEAN material.
This seems to represent the peak of the market, with prices weakening to USD 350 pmt CIF at time of publication.
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 3 International Glycerine Prices: Outlook

- August 2020 monthly imports into China were the lowest of the past 2 years. Reduced
glycerine availability in South-East Asia and South America has forced the Chinese market

December 2020 Oleoline Glycerine Market Report / Issue N° 131

to work with smaller volumes for which they had to pay a higher price than in 2019.
Strong epichlorohydrin prices have supported refined glycerine values.

- The flow of international business of glycerine to China is increasingly in the form of

refined glycerine and long term contracts.

- As the Chinese economy has reignited faster and stronger than other regions, trade
imbalances are becoming visible. A lack of containers available for moving goods has
started disrupting contract executions in the past couple of months.

- With stocks of most buyers replenished, Chinese glycerine prices have started decreasing
in December. It looks like demand will remain on the low side until the end of QI 2021.

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 December 2020 Oleoline Glycerine Market Report / Issue N° 131
CONCLUSION

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 CONCLUSION
2020 was a year of extraordinary volatility for glycerine prices, effectively providing a change of trend
every quarter. There is definitively the feeling - and desire - for the end of a cycle coming along with the
end of the year. The relief provided by vaccination campaigns to be rolled out throughout the world in

December 2020 Oleoline Glycerine Market Report / Issue N° 131

the coming months promises to unveil what we can expect our new normal to become.
Supply of glycerine has been strong but nonlinear during the year. A relatively good year for biodiesel
production in the USA, Brazil and Indonesia made up for disappointment elsewhere. Cheaper vegetable
oils are expected as from the second quarter of 2021, as La Niña evolves from a hinderance to a support
in supply. Glycerine supply ought to be at least as good worldwide in 2021.
OUTLOOK
A contrasted picture is expected to emerge in terms of demand. The full impact of the economic crisis
has yet to materialize and whole industries will suffer tremendously next year, including the automobile
and hospitality sectors. Simultaneously, the unprecedented scale of governmental support will
inoculate extra energy in other winning industries including renewable energy and chemistry, food, feed
and pharmaceutical and sanitization sectors.
Glycerine prices seem bound to increase in the USA and to remain temporarily on the high side in
Europe and in South-East Asia, until an increase in output replenishes stocks. Chinese importers will be
eager to try to pull prices down by stepping out of the market. This strategy has not been covered in
success during 2020.

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