ITOCHU to become an official distributor of Neste MY Renewable Diesel in Japan

Neste and ITOCHU have agreed to extend their collaboration with a licensing agreement allowing ITOCHU to become an official distributor of Neste MY Renewable Diesel in Japan, said Hydrocarbonprocessing.

Based on this agreement, the availability of Neste MY Renewable Diesel will be expanded in the market, for example, to the area around Osaka in order to supply the fuel to the construction site of the Osaka-Kansai Japan Expo taking place in 2025.

Japan has accelerated the steps towards decarbonization in order to meet two ambitious climate goals: carbon neutrality by 2050 and a 46% reduction in greenhouse gas (GHG) emissions by 2030. Neste and ITOCHU share a common vision of renewable fuels playing a key role in reducing greenhouse gas emissions in Japan. The key focus in the current collaboration will, therefore, be not only on selling but also on promoting the use of more sustainable fuels, accelerating the transition from fossil fuels to renewable fuels, and increasing knowledge sharing on renewable diesel and the benefits it provides to its users.

“We are very excited to expand our Neste MY Renewable Diesel offering in Japan. We firmly believe that all solutions are needed to reduce transportation-related emissions and support Japan’s target of reaching carbon neutrality by 2050. We are committed to supporting our customers to reduce greenhouse gas emissions by at least 20 million tons annually by 2030,” says Peter Zonneveld, Vice President Sales, Europe and APAC at Neste’s Renewable Road Transportation business unit.

Neste and ITOCHU started collaborating in Japan already in June 2021 to make renewable diesel available to selected customers in Japan. At the time, the partners agreed to build a strategic partnership to accelerate the use of renewable diesel as a low-emission solution for diesel engines in Japan.

“The relationship between Neste and ITOCHU first started as early as in 2010, when we collaborated on renewable diesel in California. We are now very pleased to deepen the relationship by expanding the distribution of renewable diesel in Japan. Renewable diesel is getting a lot of attention as a solution for decarbonizing multiple industries such as heavy duty transportation, off-road and railways in Japan. We are very happy to strengthen the partnership with Neste and thereby help the Japanese market to reduce its greenhouse gas emissions,” says Tatsuya Tanaka, ITOCHU’s General Manager of the petroleum trading department.

By switching fossil diesel to Neste MY Renewable Diesel, GHG emissions can be reduced by as much as 75 to 95%* when emissions over the fuel's life cycle are compared with fossil diesel. Neste MY Renewable Diesel is produced from 100% renewable raw materials. It is a drop-in fuel, not requiring any modifications to the existing diesel-powered vehicles or fuel distribution infrastructures.

The expansion of the partnership between Neste and ITOCHU also builds on the existing collaboration to increase the availability of Neste MY Sustainable Aviation Fuel™ (SAF) in the Japanese market. Using Neste MY Sustainable Aviation Fuel reduces greenhouse gas emissions by up to 80% over the fuel’s life cycle compared to using fossil jet fuel**. As part of their collaboration, Neste and ITOCHU are currently supplying SAF at Haneda, Narita and Chubu International Airports, supporting Japanese airlines and the Japanese government with their emission reduction targets.

We remind, Neste is looking to build capacities at its Porvoo site to process 400,000 tons of liquefied waste plastic per year in the course of project PULSE, which is funded by the EU Innovation Fund. From 2030 onwards, Neste wants to process more than 1 million tons of waste plastic per year.

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Oil prices rose in early Asian trade on Monday after U.S. leaders reached a tentative debt ceiling deal, possibly averting a default in the world's largest economy and oil consumer, said Hydrocarbonprocessing.

Brent crude futures climbed 39 cents, or 0.5%, to $77.34 a barrel by 2317 GMT, while U.S. West Texas Intermediate crude was at $73.12 a barrel, up 45 cents, or 0.6%.

U.S. President Joe Biden and House Speaker Kevin McCarthy on Saturday reached an agreement in principle to suspend the $31.4 trillion debt ceiling. Both leaders expressed confidence on Sunday that members of the Democratic and Republican parties will vote to support the deal.

However, relief for global financial markets could be short-lived as once the deal is approved, the U.S. Treasury is expected to issue bonds that will further tighten liquidity and make funding more expensive for companies already reeling from high interest rates.

Last week, Brent and WTI notched a second consecutive weekly gain of more than 1% on the progress of the U.S. debt ceiling talks and after Saudi energy minister warned short-sellers betting oil prices will fall to "watch out" for pain.

Some investors took the warning as a signal that OPEC+, the Organization of Petroleum Exporting Countries and allies including Russia, could consider further output cuts at a meeting on June 4. However, Russian Deputy Prime Minister Alexander Novak said last week he expected no new steps from OPEC+ as a decision on voluntary production cuts was made just a month back.

U.S. energy firms cut rigs for a fourth week in a row, with oil rigs down by five to 570 last week to their lowest since May 2022, energy services firm Baker Hughes Co said in its weekly report on Friday.

Investors are watching for China's manufacturing and services data this week as well as U.S. nonfarm payroll data on Friday for signals on economic growth and oil demand.

We remind, Russia is leaning towards leaving oil production volumes unchanged ahead of an OPEC+ policy meeting on June 4 because Moscow is content with current prices and output, three sources with knowledge of current Russian thinking told Reuters. OPEC+, which groups the Organization of the Petroleum Exporting Countries with Russia and other allies, surprised the market on April 2 with further output cuts that pushed up the price of oil.


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China's independent oil refiners are ramping up fuel oil imports to process into gasoline and diesel amid robust refining margins as ongoing cargo inspections at refining hub Shandong have cut off supplies of lower-priced feedstock bitumen blend, said Hydrocarbonprocessing.

The independent refiners, known as teapots, are mainly based in China's Shandong province, where the government has increased inspections to identify instances where crude oil is mislabeled as bitumen blend, a mix of Venezuelan heavy oil and residue fuel used to produce road-paving asphalt.

The inspections are forcing refiners to turn to fuel oil instead of bitumen blend driving the higher fuel oil imports, said traders and analysts.

Fuel oil arrivals, predominantly declared as from Malaysia and Russia, may reach 2.3 million tons this month, according to estimates by tanker trackers Refinitiv and Vortexa. That is down from the 2.67 million tons imported in April, according to Chinese customs data, a 10-year high.

Diluted bitumen imports sank to 121,000 tons in April, customs data showed, the lowest since August 2019, and a fraction of March's 1.42 million tons. May imports could be even lower, traders said. "Fuel oil benefited from the bitumen mix saga," said a senior trader supplying Shandong, adding that record imports arrived even as the authorities also tightened checks on fuel oil.

Crude, unlike bitumen mixture, is subject to strict import quotas, while Beijing manages fuel oil imports via a looser quota system. Independent refiners often switch to lower-priced fuel oil or bitumen mix when short of crude quotas.

Amid the customs checks, companies have avoided importing bitumen blend while others have rebranded cargoes as crude oil using import quotas as authorities move to draft up quality specifications for the product to stop the mislabeling, traders said.

The inspections have limited the teapots' throughput to 64.3% of their capacity as of May 24, higher than April but below earlier expectations, despite robust domestic refining margins, said Zhou Mi, an analyst at Chinese consultancy JLC.

Most of the bitumen mixture imports are blended from Venezuela's heavy crude Merey but branded as sourced from Malaysia, a transshipment hub, to circumvent U.S. sanctions on the South American exporter, Reuters has reported.

Fuel oil imports classified as from Malaysia and Russia have surged since the start of 2023, as western sanctions on Moscow forced a diversion of Russian fuel from Europe to Asia, sometimes via transshipment in the United Arab Emirates, traders said.

It was reported earlier, Russia is leaning towards leaving oil production volumes unchanged ahead of an OPEC+ policy meeting on June 4 because Moscow is content with current prices and output, three sources with knowledge of current Russian thinking told Reuters. OPEC+, which groups the Organization of the Petroleum Exporting Countries with Russia and other allies, surprised the market on April 2 with further output cuts that pushed up the price of oil.

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Huhtamaki Oyj has signed a EUR125 mln bilateral term loan facility agreement with a maturity of two years, said tthe company.

The term loan will be used for refinancing and general corporate purposes of the Group.

The facility has a one-year extension option at the discretion of the Lender, and the interest margin is tied to three sustainability indicators: absolute scope 1 and 2 greenhouse gas emissions amount; share of non-hazardous waste recycled; and Ecovadis Rating.

The lender of the facility is OP Corporate Bank Plc.

We remind, Huhtamaki has inaugurated a 12,500m2 expansion of its paper-based packaging manufacturing site in Nules, Spain. The expansion involved a EUR20m (USD20.8m) investment, which included a grant of EUR2.2m (USD2.3m) from the Conselleria de Hacienda y Modelo Economico. Huhtamaki said the expansion will begin production this January and double the site’s capacity.

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RINA, an international company specializing in inspection, certification and engineering consultancy, and Eni have signed an agreement to jointly develop initiatives that can contribute to the energy transition and decarbonization of their respective operations and particularly maritime transport, where RINA and Eni can benefit from each other's expertise, said Hydrocarbonprocessing.

Specifically, the agreement focuses on the use of HVO (Hydrogenated Vegetable Oil) biofuel produced by Eni in its Venice and Gela bio-refineries, as well as of other energy carriers such as “blue” or “green” hydrogen and ammonia from biogenic, renewable or waste raw materials not competing with the food chain, in the naval sector. Moreover, the partnership encompasses the development of initiatives for the logistics and value chain of new energy carriers, and the adoption of certified methods for the "taxonometric" calculation of the emissions benefits they will generate.

Eni and RINA will also consider carrying out experiments and pilot projects related to the on-board capture of CO2 emissions in order to further contribute to pursuing the naval sector's sustainability goals.

Ugo Salerno, Chairman and CEO of RINA, said: “Cooperation between companies is the way forward towards the common goal of decarbonizing industry and transport. By sharing know-how and experience with Eni, we will contribute to developing innovative energy supply models. Our collaboration will begin by focusing on the maritime sector, a diversified and hard-to-abate industry that can draw on initiatives already adopted by other industrial segments to decarbonize operations”.

Giuseppe Ricci, Chief Operating Officer for Energy Evolution at Eni, said: “Eni and RINA can make a significant contribution to the decarbonization of maritime transport with their wealth of expertise and technological capabilities. Following a technology-agnostic approach, we are exploring multiple solutions. Thanks to this agreement, we will have the opportunity to study and develop them in the short, medium and long term, with the objective of making maritime transport more sustainable and meeting the needs of shipowners and logistics operators”.

We remind, Eni has launched an initiative to encourage the use of HVOlution, Eni Sustainable Mobility’s first diesel produced from 100% renewable raw materials (according to EU Directive 2018/2001 'REDII'), by its suppliers' vehicles transporting fuels to Eni Live Stations. It aims to contribute to the decarbonisation of the heavy transport sector, which involves approximately 300 vehicles in Italy’s distribution service. To date, more than 200,000 km have been covered using pure HVO, making it a major contributor to CO2 emission reduction.

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