Standard fuel injection hose will not stand up to Biodiesel over time. Viton is reportedly the best, but is very expensive and hard to find. I think Greaseworks sells it.
Another alternative is some hose I found made by Goodyear. It has a blue liner, and is supposed to be Biodiesel resistant, according to Goodyear's own spec sheet. It is also hard to find, but some AutoZone stores carry it. 5/16 is the common size you will need for the VW diesel. It is marketed as a fuel injection hose, if I remember correctly. It is not particularly cheap either, but much less than Viton.
It would be a good idea to re-seal your pump....extra handy if you are doing a timing belt change, may as well do both at once. There are re-seal kits marketed as biodiesel resistant, use one of those.