Glycerine is a co-product, and that single fact explains most of its price behaviour. Roughly one tonne of crude glycerine is produced for every ten tonnes of biodiesel, so supply is set by biodiesel production rates rather than by demand for glycerine itself. When biodiesel output rises, glycerine supply rises whether or not anyone wants it, and the price falls.
Crude glycerine at around 80% glycerol and refined glycerine at 99.5% and above are effectively separate commodities. Crude is traded on assay — glycerol content, MONG, ash, water and methanol — and is priced against the cost of refining it. Refined material is traded against the pharmacopoeia monograph and against competing uses in food, pharmaceuticals and personal care, which are far less price sensitive.
Crude glycerine is normally quoted per tonne on an assay basis, with price adjustments for glycerol content below the agreed level and for MONG or methanol above it. Refined glycerine is quoted against the grade — USP/EP, technical, or food grade — with a separate premium for kosher, halal, RSPO or documented vegetable origin. Freight matters more for crude than for refined, because the value per tonne is lower.
Because crude glycerine is heterogeneous, the commercially important steps are independent sampling and analysis at both load and discharge, and a contract that states which assay governs. For refined glycerine the important questions are documentary: the monograph the lot is released against, the origin of the vegetable feedstock, and whether the lot is held under a recognised certification.
Because it is an unavoidable co-product rather than a target product. Biodiesel plants produce it whether the market wants it or not, so when biodiesel output is high the glycerine price is pushed down toward its alternative value as a low-grade carbon source.
Refined pharmaceutical grade glycerine normally carries a substantial premium over crude 80% material, reflecting the distillation and treatment cost, the monograph testing and release, and the higher-value applications it can enter. The exact spread varies with refining capacity and crude availability.
Inversely, in the main. Strong biodiesel margins push plants to run harder, which increases crude glycerine supply and tends to weaken its price. Weak biodiesel margins cut output and tighten glycerine supply.
Matter organic non-glycerol is the organic material in crude glycerine that is not glycerol. Higher MONG reduces the yield of refined glycerine a refiner can obtain and increases treatment cost, so parcels are discounted for MONG above the agreed specification.
Crude glycerine is sold on assay, with contractual adjustments around an agreed glycerol, MONG, water, ash and methanol specification. Refined glycerine is sold against a named grade and monograph.
