Argentina: Biofuels Annual

Argentine biofuel production in 2021 continues to suffer from the negative effects of the COVID-19 pandemic which has reduced fuel demand, a prolonged domestic economic recession, and recent changes in policy. Bioethanol production is forecast at 980 million liters, which except for 2020, is the lowest volume since 2016. Biodiesel production in 2021 is projected at 1.54 billion liters, which except for 2020, is the lowest since 2010, when a blend mandate was first put in place. Exports are forecast at 1.1 billion liters, similar to 2019, prior to COVID-19. The EU continues to be the only market where Argentine biodiesel is being shipped and sales to additional markets are not anticipated due to the large price spread between diesel and soybean oil and import duties at some destinations. In July 2021, the Argentine Congress passed Law 27640, which will provide the government with the flexibility to reduce biofuel blend rates to as low as 9 percent for bioethanol and 3 percent for biodiesel.