Brazil mandates that biodiesel used in mandatory blending must be domestically produced

Brazil has recently further strengthened its biodiesel localization policy. According to CNN, the National Council of Energy Policy (CNPE) has decided that all biodiesel used in the mandatory diesel blend (B-blend) must be produced by domestic facilities authorized by the National Agency of Petroleum, Natural Gas and Biofuels (ANP).

This measure clearly reinforces the policy direction of prioritizing domestic biodiesel supply and, in practice, restricts the entry of imported biodiesel into the blending system. Previously, some market participants had advocated for easing import restrictions to enhance supply flexibility and price competitiveness. However, this policy adjustment indicates that Brazil continues to prioritize energy security and the development of its domestic industry.

Overall, the policy is expected to help stabilize the domestic biodiesel industry chain, but it may also limit the participation of external resources to some extent.