Fierce competition pushes prices down at Brazilian biodiesel auction

agra-net.com
Friday February 18 2011

Biodiesel prices achieved at the National Petroleum Agency's (ANP) latest biodiesel auction on February 16, 2011 were sharply below the maximum reference price, showing once again the rising competition on the Brazilian biodiesel market.

The 21st ANP auction comprised a 528 mln litre lot reserved for authorised biodiesel producer taking part in the Combustivel Social initiative, which means that they purchase at least part of their oilseed requirement from small-family farms. The second, 132 mln litre lot was reserved for authorised biodiesel producers necessarily not taking part in Combustivel Social. The reference price was set at BRL2.43 ($1=BRL1.67) per litre, up from BRL2.32 in the last two auctions reflecting developments on the soy markets. In the first lot, where a mere 90% of the lot was sold, an average BRL2.01 per litre was achieved, equivalent to a disagio of 17% over the reference price. The average price in the second lot was BRL2.03 per litre (-13%). The biodiesel will be used for B-5 blends according to the current blending obligation by Petrobras' and Refap's refineries in Q2 2011.

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