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<br>Company makes 3rd cut to renewables business outlook this year<br> |
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<br>Reduces both margin and volume outlook<br> |
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<br>Weaker diesel market strikes [biofuel](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608) costs<br> |
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<br>(Adds analyst, background, information in paragraphs 2-3, 9-11)<br> |
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<br>By [Elviira Luoma](https://www.zoominfo.com/c/mission-newenergy/346542889) and Essi Lehto<br> |
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<br>HELSINKI, Sept 11 (Reuters) - Finnish refiner Neste on Wednesday cut the margin outlook for its [biofuel](https://www.nasdaq.com/market-activity/ipos/overview?dealId=804419-65608) service for the 3rd time this year due to falling costs and likewise [lowered](https://pitchbook.com/profiles/company/51278-86) its [expected](https://www.energy-xprt.com/companies/mission-newenergy-limited-36048) sales volumes, sending the business's share rate down 10%.<br> |
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<br>Neste stated a drop in the rate of regular diesel had impacted what it can charge for the [biofuel](https://www.google.com/search?kgmid=/m/0cqd_rb) it makes in Europe and Singapore, while [input expenses](https://www.crunchbase.com/organization/mission-newenergy) for waste and [residue feedstock](https://www.investing.com/equities/mission-newenergy-ltd-company-profile) stayed high.<br> |
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<br>A rush by U.S. fuel makers to recalibrate their plants to produce eco-friendly diesel has actually developed a supply glut of low-emissions biofuels, [hammering revenue](https://www.proactiveinvestors.com.au/ASX:MBT/Mission-NewEnergy-Ltd) margins for refiners and threatening to restrain the nascent market.<br> |
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<br>Neste in a [declaration slashed](https://forest500.org/rankings/companies/mission-newenergy-limited) the anticipated average similar sales margin of its renewables unit to in between $360-$480 per tonne of [biofuel](https://www.businessnews.com.au/Company/Mission-NewEnergy), below $480-$580 per tonne seen in July and well listed below the $600-$800 seen in February.<br> |
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<br>The [company](https://www.google.com/search?kgmid=/m/0cqd_rb) now likewise anticipates renewables-based sales volumes in 2024 to be about 3.9 million tonnes instead of the 4.4 million it had actually forecasted considering that the start of the year, it included.<br> |
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<br>A part of the volume cut originated from the production of sustainable aviation fuel, of which it is now expected to offer between 350,000-550,000 tonnes this year, down from between 500,000 and 700,000 tonnes seen formerly, Neste said.<br> |
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<br>"Renewable products' sales costs have actually been negatively affected by a significant reduction in (the) diesel price throughout the 3rd quarter," in a statement.<br> |
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<br>"At the same time, waste and residue feedstock prices have actually not decreased and eco-friendly item market value premiums have actually stayed weak," the business added.<br> |
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<br>Industry executives and [experts](https://www.bloomberg.com/profile/company/MNELF:US) have actually stated rapidly expanding Chinese [biodiesel](https://biodieselmagazine.com/articles/felda-global-buys-missions-kuantan-port-plant-for-11-5-million-9053) [manufacturers](https://forest500.org/rankings/companies/mission-newenergy-limited) are seeking new [outlets](https://www.energy-xprt.com/companies/mission-newenergy-limited-36048) in Asia for their exports, while Shell and BP have actually announced they are [stopping](https://www.marketscreener.com/quote/stock/MISSION-NEWENERGY-LIMITED-178469/company/) briefly growth strategies in Europe.<br> |
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<br>While the cut in [Neste's guidance](https://www.proactiveinvestors.co.uk/companies/news/159352/mission-newenergy-debt-free-focused-on-biofuel-joint-venture-60797.html) on sales volumes of sustainable [air travel](https://www.sec.gov/Archives/edgar/data/1463471/000165495419013063/R31.htm) fuel came as a surprise, the unfavorable influence on [biodiesel](https://biodieselmagazine.com/articles/felda-global-buys-missions-kuantan-port-plant-for-11-5-million-9053) margins from a lower diesel price was to be anticipated, Inderes expert Petri Gostowski stated.<br> |
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<br>Neste's share cost had actually reversed some losses by 1037 GMT however stayed down 5.8% on the day and 48% lower year-to-date. (Reporting by Elviira Luoma, [Essi Lehto](https://www.sec.gov/Archives/edgar/data/1463471/000165495419013063/R31.htm) and Boleslaw Lasocki |
