Argentina's portside processing plants are expected to increase output of biodiesel as a drop in soyoil demand has pushed them to seek more profitable alternatives, industry officials said on Wednesday.
China has not bought soyoil from Argentina so far this year, as it moves toward importing raw soybeans to be crushed on the mainland. This has shifted Argentine exports toward India, which also has access to cheaper palm oil.
Such factors have Argentine soy processors setting their sites more on biodiesel, which would "increase the value of our exports," said Luis Zubizarreta, head of Argentina's biofuels industry chamber Carbio.
Argentina's main biodiesel producers include global exporting giants like Bunge, Cargill Inc and Louis Dreyfus Corp. They are represented by trade group CIARA-CEC, which recognizes the need for Argentina to produce more of the fuel.
"China had been an important buyer of Argentine soyoil. China was good for a half a million tonnes of soyoil per year. Today that volume has had to move for the most part of India, where you have to compete with palm oil," said CIARA-CEC President Alberto Rodríguez.
"Biodiesel is important right now. We need to produce more, which would help support soyoil prices," Rodriguez said.
The World Trade Organization upheld Argentina's complaint against European Union duties on biodiesel this month. A major exporter of biodiesel and the world's top soyoil supplier, Argentina had called the EU measures protectionist and said they cost the country almost $1.6 billion in lost sales annually.
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