The biofuel discussion emerged in a panel session at the IBIA Annual Convention 2022 in Houston on Wednesday. Image Credit: Ship & Bunker
Demand for biofuel bunker blends in the US appears not to be emerging at the same pace as in Northwest Europe and Singapore.
Demand for biodiesel in the US bunker market has been 'minimal' so far this year, Georgia Kounalakis, managing director of Bunker One USA, said in a panel session at the IBIA Annual Convention 2022 in Houston on Wednesday.
"We're running a trial with one of our barge operators at the moment and we are seeing some very nice results, so we are going to see an uptick, there's no doubt," Kounalakis said.
Biofuels are 'close to our heart', she added.
"But, to answer directly, we are not seeing demand on a daily basis."
Kounalakis's point was echoed by Marc Holm, senior fuel oil trader at Hartree Partners.
"There's nothing on a scale that justifies taking tanks and product, and then sitting there and staring at it for two months," Holm said.
The lack of demand in the US is at odds with the biofuel bunker market emerging in Northwest Europe and Singapore. Singapore saw about 70,000 mt of biofuel blend sales in the first nine months of the year, while Rotterdam saw about 193,000 mt in the third quarter alone.
A change in regulation may be needed to stimulate the market in the US, Holm said.
"It would help if the US biodiesel regulation and taxation was aligned a little better for the marine fuel market," he said.
"If [biodiesel] goes into road diesel blending all the tax benefits are available, but if it goes into marine fuel they're not.
"Then it seems like an inefficient use of that molecule to take it into the market that won't allow that."