In the News
Jan 11, 2018
The Bolivian government announced its intention to establish an ethanol blend mandate during a December seminar conducted by the U.S. Grains Council (USGC).
Bolivian Vice President Garcia Linera made the announcement during closing remarks at the event, reporting the government’s decision to implement an ethanol blend mandate starting at 10 percent in 2018 with goals of mid-level blends in coming years.
Bolivia did not previously have an ethanol blending mandate, though the country has seven sugarcane milling facilities already producing ethanol domestically. Linera emphasized the mandate would help increase domestic gross domestic product (GDP) in Bolivia by supporting local industry, while maintaining a role for trade to help consistently meet the E10 blend level.
“The Bolivian announcement is an exciting development for ethanol policy in the Americas,” said Mike Dwyer, USGC chief economist. “This success of the Council’s work to promote biofuels policies with a role for trade is directly attributable to the efforts to increase knowledge sharing and collaboration like at the Ethanol Summit of the Americas last fall.”
Linera’s comments followed a seminar organized by the Council to provide information on the economic and environmental benefits of biofuels. In addition to Dwyer, speakers from Mexico, Paraguay and Argentina provided information on the movement towards using ethanol and discussed the main constraints to developing biofuels policies in their respective countries.
“The seminar helped start the discussion between the public and the private sector in Bolivia for establishing an ethanol mandate,” Dwyer said. “Additionally, we offered knowledge and expertise from the U.S. perspective in growing an ethanol industry to help make it happen.”
During the same mission, the Council traveled to Ecuador to continue a similar dialogue on biofuels. Ecuador does have an E5 mandate in place, but a reliance on sugarcane to produce ethanol results in difficulty guaranteeing the blend rate during heavy rainy seasons that disrupt local production.
In contrast, an ethanol mandate with a role for trade would support the Ecuadorian domestic industry while ensuring the blending rate is met throughout the year, no matter the local weather disruptions. The blend mandate also contributes to Ecuador’s commitments under the Paris climate agreement to implement effective strategies to reduce greenhouse gas emissions.
“The Council expects this open dialogue between the private sector and government officials to result in future cooperative efforts to increase ethanol consumption,” Dwyer said. “The Council helped this effort by providing firsthand information about ethanol’s environmental benefits and market opportunities for the local industry in Ecuador.”
The Council arranged the meetings in Ecuador and Bolivia as a direct follow-up to the Ethanol Summit of the Americas in October 2017, after which representatives from both countries expressed additional interest in developing ethanol policies and requested further discussions. The Council plans to continue this dialogue and encourage the generation of biofuels policies throughout the world.
“U.S. ethanol has a competitive advantage in Latin America driven by cost of production, efficiencies and reduced transportation costs,” Dwyer said. “We aim to expand the use of ethanol in the region - including in Bolivia and Ecuador - through continuing to facilitate discussions on establishing pathways for its use.”
Learn more about the Council’s work to promote biofuels policies with a role for trade here.
January 16, 2018
By Jake Spring, Mateus Maia
Brazil is studying the removal of a 20-percent tariff on ethanol imports from the United States, Agriculture Minister Blairo Maggi said on Wednesday, in a decision that could depend on Washington lifting a ban on fresh beef exports from Brazil.
Last year, Brazil imposed a 20-percent tax on ethanol imported from the U.S. that exceeds a 600 million liter annual quota to protect local producers as imports spiked.
Also in 2017, the U.S. banned shipments of fresh beef from Brazil following on a food safety scandal involving bribes paid to inspectors that led to heightened inspections by the U.S. and in turn uncovered potential health risks.
Speaking to reporters on Tuesday, Maggi implied that a decision on removing the ethanol import tariff could depend on resolving the dispute on beef exports.
“There is on the part of the United States a big demand to withdraw this (ethanol tariff) and we also have this problem with beef,” Maggi said. “Obviously one thing influences and contaminates the other.”
The ban on fresh beef exports could be lifted by April, Maggi said, when he is expected to step down in order to meet a deadline to run for elected office in October.
Brazil has already submitted all of the material requested by the United States to address concerns over beef exports and is awaiting for the United States to decide whether the issue is resolved, he said.
Read the original article: Brazil Considers Lifting Tariff on U.S. Ethanol
Environmental and Energy Study Institute
January 12, 2018
By Jessie Stolark
EPA administrator Scott Pruitt opened up the year by announcing his three regulatory priorities for 2018; rewrite the Clean Power Plan, rewrite the Waters of the United States and overhaul the Renewable Fuel Standard. Within the RFS, one can only take his comments to mean specifically – overhaul the RINs marketplace. Renewable identification numbers (RINs) are the tradable credits attached to every gallon of renewable fuel and used as a compliance mechanism for the Renewable Fuel Standard (RFS). They have been the oil refining industry’s favorite punching bag for quite some time.
The argument is roughly – increased biofuels mandates lead RINs to spike in cost, translating to billions in compliance costs, particularly for small refiners. While somewhat logical, as higher RINs costs have to be absorbed somewhere, this logic has not borne out. According to multiple economic studies, refiners recoup the higher RIN cost through what refiners call the ‘crack spread’ or the difference in price between the unrefined petroleum and the refinery products, such as gasoline, diesel, jet fuel and heating oil. When the RIN price increases, the crack spread increases, and when they fall, the crack spread decreases.
While President Trump has been largely unwavering in his support for the domestic biofuels industry, the administration often finds itself at odds with two industries it purports to support -- oil and biofuels. The issue reached a fever pitch early in the Trump administration, with former White House special advisor Carl Icahn supporting changes to who was required to comply with the RFS. Icahn is a major shareholder in the merchant refinery CVR Energy and is currently under federal investigation for his unusual role in the administration.
More recently, Senator Ted Cruz (R-TX) has led efforts to seek ‘regulatory relief’ for refiners from RINs. Cruz has been the latest standard bearer for the argument that the credits are costing refiners millions of dollars and put the sector at risk of major jobs cuts.
After putting a hold on the confirmation of Bill Northey, the Iowa Secretary of Agriculture, for the position of Undersecretary for Farm Production and Conservation at USDA, Cruz was able to garner several meetings at the White House to broker a supposed deal with corn-state leaders late last year. Last month, Cruz also floated a proposal to cap RIN prices at 10 cents, a non-starter with the biofuels industry.
Agricultural economists with FarmDoc, at the University of Illinois, independently assessed the 10 cent cap to RINs proposal, concluding that it would be a defacto 10 percent blending cap and “would reverse the technology-forcing intent of the statutory mandate.” They also questioned the legality of such a change, without further Congressional intervention to change the statute.
Indeed, RIN prices drop when more biofuels are blended into the fuel supply, making producing and blending renewable fuels more attractive. In this sense, RINs have worked exactly as designed.
Over the past several years, it’s practically become conventional wisdom that the RINs market is “broken” and causing significant hardship to the refining industry, particularly small merchant refiners that don’t have the capacity to blend biofuels without investing in blending technology.
However, at least one merchant refiner has publicly admitted that there is no evidence of economic harm from RINs, with merchant refiner Tesoro stating, “RIN costs are passed through at the bulk finished product sales points and provide refiners with coverage of their exposure to them.”
Even labor unions have begun to question the logic, with Ryan O’Callaghan of the United Steelworkers Local 10-1, representing workers at the PES Refinery in Philadelphia, PA stating, “We have information that the RINs might not be impacting [the refiner] as stated.”
Instead, the blame for sometimes low refining margins and cyclical petroleum markets is more complex, according to groups such as the Renewable Fuels Associate. In the Northeast, for example, expensive crude oil from Western Africa and the Northern Sea regions, falling Bakken supplies, and old infrastructure are all issues at play, not RINs.
As to the compromise that lawmakers want to see from the biofuels and refining industry, RFA CEO Bob Dineen recently noted that there is little consensus among the oil industry, stating, “So, what problem are we really trying to solve? Whose problems are we trying to solve? And how many bites of the apple are they going to get?”
Read the original article: RFS Roundup: Economists Largely Agree RINs Not Wreaking Havoc on Refining Industry
January 12, 2018
By Erin Voegele
The USDA has released its World Agricultural Supply and Demand Estimates report for January, reporting larger corn production, increased food, seed and industrial use, lower estimates for feed and residual use, and reporting greater stocks.
Corn production is currently estimated at 14.604 billion bushels, up 26 million bushels when compared to the December WASDE. The increase is attributed to an increase in yield, which reached a record 176.6 bushels per acre. The increase was was partially offset by a 400,000 acre reduction in harvested area. Among the major producing states, yields are estimated to be record high in Illinois, Minnesota and Ohio.
The estimate for food, seed and industrial use is raised 10 million bushels, reflecting an estimated amount of corn used for glucose and dextrose during September-November that was above expectations. For ethanol and byproducts, projected corn use is unchanged at 5.525 billion bushels. Feed and residual use is down 25 million bushels, falling to 5.55 billion based on indicated disappearance during September-November as reflected by the Dec. 1 stocks.
Corn stocks are up 40 million bushels when compared to December. The season-average corn price received by producers is projected at $3.25 per bushel, up 5 cents at the midpoint based on observed prices to date.
Foreign corn production is forecast lower, with reductions for Russia, Vietnam and the Philippines more than offsetting an increase for Pakistan. Russia’s corn production is down based on harvest results to date. Vietnam corn production is reduced as the impact of heavy rain during the growing season in the northern production areas was worse than previously expected.
Lower 2017-’18 corn exports are expected for Russia, partially offset by an increase for Thailand. Brazil’s 2016-’17 corn exports are reduced based on observed shipments to date for the local marketing year, which started in March. Imports for 2017-18 are lowered for Iran, but increased for Vietnam and Philippines. Foreign corn ending stocks are higher than last month, mostly reflecting increases for Brazil and Pakistan. Global corn stocks are at 206.6 million, up 2.5 million from last month.
Read the original article: USDA Raises Estimate for Corn Production in January WASDE
January 12, 2018
By Iowa Ag Connection
Iowa Secretary of Agriculture Bill Northey announced that Kwik Trip, Inc. the Iowa 80 Truckstop in Walcott are the 2018 winners of the Secretary's Ethanol and Biodiesel Marketing Awards. The awards were created by the Iowa Department of Agriculture and Land Stewardship to recognize fuel marketers that have gone above and beyond in their efforts to promote and sell renewable fuels.
"Kwik Trip and the Iowa 80 Truckstop have both made marketing renewable fuels a central part of the business and it is great to recognize the commitment and investment they have made to do it successfully," Northey said.
The Secretary's Ethanol and Biodiesel Marketing Awards were designed to recognize businesses that market the renewable fuels they have available through creative efforts including, but not limited to: hosting special events highlighting their renewable fuels, development of creative signage, initiation of new advertisements or marketing efforts, and dramatically increase renewable fuel availability.
The winners were announced and recognized during the Petroleum Marketers & Convenience Stores of Iowa Annual Meeting in Des Moines. The Petroleum Marketers and Convenience Stores of Iowa (PMCI) is a non-profit state trade association serving the needs of independent petroleum marketers and convenience store owners throughout the state of Iowa.
"Fuel marketers allow customers to access ethanol and biodiesel blends produced right here in Iowa. Our state is a national leader in renewable fuels production, and we are very fortunate that many retailers are making significant investments to provide their customers with renewable fuels," Northey said.
Kwik Trip is winner of the 2018 Secretary's Ethanol Marketing Award. Kwik Trip, Inc. is headquartered in Lacrosse, Wisconsin and operates 86 stores in the state of Iowa, 69 of those locations sell fuel. Kwik Trip, Inc. currently has 25 locations in the state of Iowa selling E15 and 25 locations selling E85.
Kwik Trip began its commitment to marketing high ethanol blends in 2003 when they began marketing E85. In February of 2017, Kwik Trip, Inc. began marketing E15 at 4 of their locations. Since February of 2017, Kwik Trip has rapidly expanded its investment into E15, offering E15 at over 300 locations.
In less than one-year, Kwik Trip, Inc. has become the nation's leading offeror for E15.
Kwik Trip believes E15 is a standard fuel and needs a consistent name, so customers will repeatedly associate the name with the fuel. Kwik Trip, Inc. markets E15 under the grade name Unleaded 88. This new marketing has brought the highest adoption rate for sales of their Unleaded 88 product in Iowa surpassing the sales of similar offerings in Minnesota and Wisconsin. Along with their own successful marketing of E15, Kwik Trip believes that the state of Iowa's leadership on ethanol paired with educational outreach directed at consumers has contributed greatly to the success of E15 sales in the state of Iowa.
Kwik Trip's commitment to offer renewable fuels to Iowans is not limited to ethanol. In 2016, Kwik Trip began selling biodiesel in all their diesel gallons marketed in the state. Kwik Trip has also committed to future investments in renewable fuels. This spring Kwik Trip plans to open a blending facility in Waterloo, Iowa that will create all blends of ethanol and biodiesel, ultimately to be marketed at its Iowa locations.
Kwik Trip was nominated for the award by the Petroleum Marketers and Convenience Stores of Iowa.
Iowa 80 Truckstop in Walcott is the winner of the 2018 Secretary's Biodiesel Marketing Award.
Iowa 80 Truckstop has offered biodiesel since 2002, which makes this the 15th anniversary of their program. The company received an Iowa Renewable Fuels Infrastructure Program grant to install the necessary equipment to offer biodiesel, and the truck stop now offers between B11 and B20 blends throughout the year.
The company has long been a supporter of renewable fuels and the Renewable Fuel Standard. Most recently, company owner Delia Moon Meier published an op-ed in the Des Moines Register supporting biodiesel and the RFS. She said, "The Renewable Fuel Standard (RFS) is important to Iowa. This program enables fuel retailers, including my truck stop on Interstate 80, to incorporate cleaner burning fuels such as biodiesel and ethanol into our fuel supply, and lowers prices at the pump and helps create jobs here in Iowa."
Located on Interstate 80 about 10 miles west of Davenport, Iowa 80 Truckstop bills itself as "The World's Largest Truckstop," and is a prominent fueling location. Making biodiesel available at a prominent, well-known location boosts biodiesel's exposure and credibility, particularly with truckers, an important market where acceptance is needed as biodiesel grows.
Iowa 80 Truckstop was nominated for the award by the Iowa Renewable Fuels Association and the Iowa Biodiesel Board.
Iowa leads the nation in the production of ethanol and biodiesel. According to the Iowa Renewable Fuels Association, Iowa has 43 ethanol refineries capable of producing more than 4 billion gallons annually, including nearly 55 million gallons of annual cellulosic ethanol production capacity. In addition, Iowa has 12 biodiesel facilities with the capacity to produce nearly 350 million gallons annually.
The Iowa Renewable Fuels Infrastructure Program offers cost-share grants for the installation of E85 dispensers, blender pumps, biodiesel dispensers, and biodiesel storage facilities. The grant program is managed by Iowa Department of Agriculture and Land Stewardship and more information can be found on the Department's website at www.IowaAgriculture.gov
Read the original article: Renewable Fuels Marketing Awards to Kwik Trip, Iowa 80
January 11, 2018
Press Release
Big Ten Network viewers, meet Mike. Mike is the animated star of a new advertising campaign initiated by the Nebraska Corn Board. He’s a smart guy who cares about his car and its engine performance. In these 15-second and 30-second television commercials, a narrator describes why Mike chooses clean-burning, high-performing E15, which is a fuel choice blended with 15 percent American Ethanol.
In order to maximize the frequency and reach of the commercials on the Big Ten Network, the Nebraska Corn Board partnered with the corn checkoff boards from Iowa, Illinois, Ohio and Kansas to amplify overall exposure. The collaboration also helps establish consistent ethanol messaging between major corn producing states.
“We’ve been working for a number of years to develop and implement a campaign on the Big Ten Network,” said Dave Merrell, farmer from St. Edward and chairman of the Nebraska Corn Board. “BTN has a loyal following across the nation. With this widespread coverage, we’re able to reach parts of the country that may have the infrastructure for higher ethanol blends, but don’t necessarily have the advertising budgets to educate consumers.”
“Consumers are seeing more choices at the pump, which is great, but it can also be confusing,” said Paul Jeschke, farmer from Mazon, Illinois, and chairman of the Illinois Corn Marketing Board. “With this campaign, we chose to focus on E15, which can be used to fuel most cars on the road today and can be found at more than 1,300 fuel stations across the country.”
A website was also created to complement the television spots. On this website, motorists can provide their location to identify E15 fueling stations near them. The website is available by visiting http://www.getbiofuel.com/BTN.
“As corn states, we all have the similar goal to enhance demand for our farmers,” said Duane Aistrope, farmer from Randolph, Iowa, and president of the Iowa Corn Promotion Board. “Ethanol has been a huge driver of corn demand, and there is still so much potential for more growth. There are also so many benefits for consumers to fill up with more homegrown fuel that’s safe for their engines and better for our environment. We hope this campaign will encourage consumers to fuel up with higher blends of ethanol.”
The E15 television commercials began airing in January 2018 during the men’s basketball season and will continue to air through the next seasons of football and volleyball. In addition to the airings on the college sports network, the spots will be added to local network and cable channels.
To view the 30-second commercial, click here.
Read the original release: Corn States Partner Together for E15 Television Campaign on Big Ten Network
January 10, 2018
By Erin Voegele
The U.S. Energy Information Administration has released the January edition of its Short-Term Energy Outlook, predicting that ethanol production in 2018 and 2019 will be maintained at the 2017 level.
Ethanol production averaged 1.03 million barrels per day in 2017. The EIA currently predicts that production level will remain steady at 1.03 million barrels per day this year and next year. In its December STEO, the EIA predicted that ethanol production would increase to 1.04 million barrels per day in 2018.
Ethanol consumption, however, is expected to increase, from 940,000 barrels per day last year to 960,000 barrels per day in 2018 and 970,000 barrels per day in 2019. The EIA said this level of consumption results in the ethanol share of the total gasoline pool increasing from an average of 10.2 percent in 2017 to an average of 10.3 percent in 2018 and 2019. According to the EIA, the increase assumes that recent marginal growth in higher-level ethanol blends continue during the forecast period.
Biodiesel production averaged approximately 105,000 barrels per day last year and is expected to increase to 117,000 barrels per day this year and 128,000 barrels per day next year. The EIA attributes the forecast increase to recent duties imposed on foreign biodiesel imports from Argentina and Indonesia, which is expected to reduce net imports of biodiesel from an estimated 41,000 barrels per day in 2017 to 32,000 barrels per day in 2018 and 35,000 barrels per day in 2019.
The January STEO notes that U.S. regular gasoline retail prices averaged $2.48 per gallon in December, down almost 9 cents per gallon from the November average, but up 22 cents per gallon when compared to the prices during the same period of 2016. U.S. regular gasoline prices averaged $2.41 per gallon last year and are currently expected to increase to $2.57 per gallon this year and $2.58 per gallon next year.
The EIA’s most recent weekly ethanol production data shows production averaged 1.032 million barrels per day the week ending Dec. 29, down from 1.09 million barrels per day the previous week. The most recent monthly import data shows the U.S. imported 69,000 barrels of ethanol in October, all from Canada. During the same month, the U.S. exported 2.231 million barrels of ethanol, primarily to Canada, Spain and India.
Read the original article: EIA Predicts Increased Ethanol Consumption in 2018, 2019
January 09, 2017
By Erin Voegele
Japan’s Ministry of Economy, Trade and Industry has opened a public comment period on proposed changes to its ethanol policy that would allow for the import of U.S. corn ethanol for use in the production of bio-ETBE. A document filed with the USDA Foreign Agricultural Service’s Global Agricultural Information Network specifies that the comments can be submitted in Japanese on government’s website. The public comment period is open through Jan. 18.
The proposed changes to Japan’s ethanol policy set a default greenhouse gas (GHG) emissions value for U.S. corn ethanol at 43.15 grams of carbon dioxide equivalent per megajoule (gCO2eq/MJ). The proposed changes also increase the default GHG emission value of Brazilian sugarcane-based ethanol from 32.7 gCO2eq/MJ to 33.61 gCO2eq/MJ. In addition, the changes would revise the default GHG emission value for gasoline from 81.7 gCO2eq/MJ to 84.11 gCO2eq/MJ.
According to the document filed with the USDA FAS GAIN, the new policy would also raise the reduction target for gasoline GHG emissions to 55 percent, up from the current 50 percent.
Under the proposed policy, U.S. corn-based ethanol will be allowed for use in bio-ETBE production when combined with Brazilian sugarcane ethanol, starting in April. Based on the revised GHG emission values for gasoline, Brazilian ethanol and U.S. ethanol, the maximum share of U.S. ethanol by volume allowed in the Japanese market would be 53.73 percent.
Additional information is available on the USDA FAS GAIN website.
Read the original article: Japan Opens Comment Period on Proposal to Allow US Corn Ethanol
More...
January 8, 2017
By Syngenta
Syngenta has announced an agreement with CHS Inc. to use Enogen corn enzyme technology at its 130-million-gallon ethanol plant in Rochelle, Illinois. CHS is a premier ethanol producer, marketer and trader and one of the nation’s largest suppliers of ethanol-enhanced gasoline.
Enogen corn enzyme technology is an in-seed innovation available exclusively from Syngenta and features the first biotech corn output trait designed specifically to enhance ethanol production. Using modern biotechnology to deliver best-in-class alpha amylase enzyme directly in the grain, Enogen corn eliminates the need to add liquid alpha amylase and can help an ethanol plant significantly reduce the viscosity of its corn mash, improving plant performance. And, numerous trials have shown that Enogen hybrids perform equal to or better than other high-performing corn hybrids1.
Enogen corn will provide the CHS Rochelle facility with an industry-leading enzyme for enhanced ethanol production while also supporting local growers and the community. Several million dollars in premiums are expected to be paid annually to growers raising Enogen corn, locally, for the CHS plant in Rochelle.
“CHS is focused on helping its farmer-owners grow,” said Mike Van Houten, CHS Rochelle facility manager. “The Enogen program provides benefits for our plant, but is also a big win for our local community with the premium to be paid on every bushel of Enogen corn brought to us.”
CHS ethanol plants manufacture the alcohol-based renewable fuel via an advanced fermenting and distilling process that efficiently converts corn into simple sugars. The resulting ethanol product is primarily used as a fuel that is commonly blended with gasoline to increase octane and improve emissions quality. The Rochelle plant is an 81-acre, dry mill corn-based operation and was acquired by CHS in June 2014.
“The CHS Rochelle facility is a large, sophisticated ethanol biorefinery,” said Glen Edwards, Enogen account manager for Syngenta. “We are excited to be working with the CHS team in Rochelle to help the facility there operate even more smoothly and efficiently. We are proud to be partnering with CHS help keep enzyme dollars local and invest in the local community. Syngenta is committed to the success of the ethanol industry through helping plants operate more efficiently and growers serve as enzyme suppliers.”
Read the original article: CHS to Use Enogen Corn at Illinois Ethanol Plant
January 5, 2018
By Ann Lewis
U.S. ethanol exports totaled 107.2 million gallons (mg) in November, up 14% from October shipments, according to government data released this morning and analyzed by the Renewable Fuels Association (RFA). Despite the imposition of a tariff rate quota and 20% tariff in September, Brazil was the leading destination for U.S. ethanol exports for the first time in six months, receiving 28.1 mg. November also saw a small volume of denatured ethanol exported to China, which has not imported any U.S. fuel ethanol in the prior 10 months. Canada scaled back its imports of U.S. product to 24.2 mg, a 29% reduction from October. Exports to India perked up at 15.5 mg, a 17% increase, while shipments to the Philippines more than doubled to 9.9 mg. These four countries accounted for nearly three-fourths of all U.S. ethanol shipments in November. Exports to all destinations for the first eleven months of 2017 stood at 1.19 billion gallons, indicating a record annualized export volume of 1.30 billion gallons.
November exports of undenatured fuel ethanol rebounded by 23% to 52.8 mg, a four-month high. Brazil increased purchases by 117% to 28.1 mg, taking over half of U.S. undenatured shipments, while the Philippines imported 6.5 mg, up 41%. Meanwhile India cut its imports in half with 6.4 mg of undenatured fuel ethanol entering the country. Switzerland (3.2 mg) and Jamaica (2.8 mg) rounded out the top five largest markets for undenatured fuel product.
U.S. exports of denatured fuel ethanol decreased by 10% from October levels to 42.0 mg. Canada again took the lead with 23.3 mg, accounting for 55% of denatured fuel ethanol exports. The remaining denatured shipments were distributed to India (5.0 mg), the Philippines (3.4 mg), Colombia (3.3 mg), South Korea (3.1 mg), China (2.4 mg), and Mexico (1.5 mg).
Overseas sales of undenatured ethanol for non-fuel, non-beverage purposes increased by 41% to 3.2 mg, with Saudi Arabia receiving 2.7 mg, or 86% of the exports. November exports of denatured ethanol for non-fuel, non-beverage purposes jumped a whopping 407% to a 68-month high (running back to March 2012). The U.S. shipped 4.1 mg of denatured non-fuel product to both Nigeria and India, accounting for the bulk of overseas sales.
For the seventh straight month this year, the United States recorded meaningful fuel ethanol import volumes. The 20.7 mg of undenatured ethanol shipped in from Brazil in November is the largest volume to enter the country in 26 months. Monthly imports have only breached 20 mg four times over the past 50 months. Year-to-date fuel ethanol imports totaled 76.5 mg, a 127% increase over the same period last year. Annualized import volumes are estimated at 83.5 mg—roughly the volume imported in 2014.
Exports of dried distillers grains with solubles (DDGS)—the animal feed co-product generated by dry mill ethanol plants—contracted 15% in November to a six-month low of 875,302 metric tons (mt), shipped to 35 countries. Mexico cut its purchases from October, although it still remained the lead destination with 144,415 mt in DDGS exports (16% of market share). Export expansion in Vietnam showed signs of slowing with a 2% increase at 103,834 mt (12% of the DDGS exports for the month). Other leading destinations included South Korea (86,983 mt, or 10%), Indonesia (76,200 mt, or 9%), and Thailand (73,917 mt, or 8%). Turkey cut its imports by half to 59,397 mt—its lowest purchase of U.S. DDGS in thirteen months. Total year-to-date DDGS exports to all countries stood at 10.1 mmt through November, indicating an annualized total of 11.03 mmt.
Read the original story: U.S. Ethanol Exports Swell in November, as Brazil is Top Destination and China Returns to Market
January 1, 2018
By Holly Demaree
Representatives from the U.S. Grains Council (USGC) recently traveled to Indonesia and Thailand to visit with ministry and industry officials and gain a better understanding of the opportunities for and challenges to expanded ethanol use in both markets.
“Indonesia is forecast to be the sixth largest gasoline market by 2022,” said Brian Healy, USGC manager of ethanol export market development. “Additionally, Indonesia has a goal for renewables to represent 23% of their energy mix by 2025 and to reduce greenhouse gas emissions (GHG) by 29% by 2030. Ethanol has a great opportunity to help Indonesia meet these ambitious goals.”
Indonesia instituted a national ethanol policy in 2006, but the mandate has largely gone unmet. The USGC engaged with Indonesia ministry officials in December to highlight the role of policy and trade in helping to develop a consistent supply chain for biofuels as well as capture the societal benefits of biofuels with regard to air quality and GHG emission reductions.
According to a life cycle analysis study released by the U.S. Department of Agriculture (USDA) in January 2017, GHG emissions associated with producing corn-based ethanol in the United States are 43% lower than gasoline on an energy equivalent basis. Additionally, U.S. corn-based ethanol is expected to help reduce emissions by more than 50% domestically in the next five years.
The mission also highlighted the competitiveness of U.S. ethanol as an octane enhancer, compared to MTBE (methyl tertiary-butyl ether), aromatics or other sources.
Following meetings in Jakarta, the USGC traveled to Thailand to assess opportunities for biofuels in that market. Thailand has an effective national blend rate of 12%, utilizing domestically-sourced sugarcane and cassava-based ethanol. Domestic ethanol production is expected to total nearly 360 million gallons in 2017.
“Thailand has successfully differentiated ethanol products to consumers at the pump by using price incentives across grades of fuel and incentivizing the use of flexible fuel vehicles,” Healy said. “Thailand also produces flex fuel vehicles for its own domestic market and for export to regional markets. As a result, Thailand is a good collaborator to discuss engine technology and biofuels policy with regional partners.”
The partnership opportunities in Thailand and Indonesia are part of the USGC’s work to engage with government and industries around the world to assist in developing biofuels policies with a role for ethanol trade.
Read the original article: USGC Explores Potential for Ethanol Use in Indonesia, Thailand
Iowa Renewable Fuels Association
December 28, 2017
Press Release
JOHNSTON, IA – Iowa’s 43 ethanol plants had another record breaking year, producing 4.2 billion gallons in 2017. The slight uptick in production from 4.1 billion gallons in 2016 is largely due to several plant expansions and increased demand of exports and higher blends like E15.
“Iowa continues to lead the country and the world in ethanol production and efficiency,” said Iowa Renewable Fuels Association (IRFA) Executive Director Monte Shaw. “Several plant expansions just finished or will finish during the 1st quarter of 2018, so production could jump again next year. That makes expanding export markets abroad and breaking down unnecessary barriers to E15 here at home top priorities.”
IRFA’s top state policy priority for 2018 is securing funding for the Iowa Renewable Fuels Infrastructure Program (RFIP) to ensure more retailers have the equipment necessary to offer higher blends of ethanol now and in the future. However, coupled with RFIP funding, action at the federal level would create the best environment for retailers to move forward with E15.
“The EPA needs to provide the same regulatory treatment for E15 as all other ethanol blends,” added Shaw. “That step alone would draw many more retailers into offering the option of E15 to their customers. Also, as the world’s cheapest source of fuel octane, we’ll be working to continue to build on the record exports of 2017.”
The Iowa Renewable Fuels Association represents the state’s liquid renewable fuels industry and works to foster its growth. Iowa is the nation’s leader in renewable fuels production with 43 ethanol refineries capable of producing 4 billion gallons annually – including nearly 55 million gallons of annual cellulosic ethanol production capacity – and 12 biodiesel facilities with the capacity to produce over 380 million gallons annually. For more information, visit the Iowa Renewable Fuels Association website at: www.IowaRFA.org.
December 24, 2017
By James C. Greenwood
A group of oil state senators is asking biofuel and agricultural producers to accept changes to the renewable fuel standard (RFS) that are intended to help a small group of refiners comply with the program. The bipartisan RFS program has been U.S. law since 2005, requiring production and use of annually increasing volumes of biofuel in the U.S. transportation market.
The refiners want to lower the price of renewable identification numbers, or RINs, which are the credits they must accumulate to prove compliance with the program — every gallon of biofuel that is blended into transportation fuel generates one of these RIN credits.
It is important to note that past changes to the RFS program — made at the request of those same refiners — have done nothing at all to change the price of the compliance credits. One compliance strategy, though, has proven successful. Refiners that made modest investments in blending capacity, or in advanced and cellulosic biofuel technologies, have been able to comply with the program by generating their own RIN credits.
Congress has tried to give relief to small refiners that are unable to blend biofuels. Most recently, the Senate Appropriations Subcommittee for Interior, Environment and Related Agencies firmly directed the U.S. Environmental Protection Agency (EPA) to grant small refiners exemptions from the program to ensure they “remain both competitive and profitable.” The agency has followed that direction and eased requirements for these hardship exemptions.
But EPA has also recognized — and categorically stated in the most recent RFS rule — that refiners are not harmed by complying with the program. Independent refiners recoup their compliance costs when they price their product for blenders; fuel blenders, in turn, recover their cost by blending biofuels and acquiring RIN credits. The refiners’ protests about high RIN costs are, in the agency’s understated opinion, unsupported by evidence and “unconvincing.”
Fortunately, EPA seems to have learned important lessons from when refiners cried wolf over the so-called blend wall. In 2013, independent refiners activated their champions in state governments, Congress and the White House to demand limits on ethanol blending because of high RIN prices.
In response, EPA delayed issuing RFS rules for two years as it sorted out the claims. The agency then used its authority to waive the biofuel blending requirements for those years and to create staggeringly large banks of surplus compliance credits. Those reserve RIN banks come from actual gallons of advanced biofuels produced and blended into the U.S. fuel supply — even though the agency’s waiver authority was based on a claim that there was an “inadequate supply” of the fuel.
The number of reserve advanced biofuel RIN credits that refiners have accumulated and rolled forward from year to year now exceeds the number that they can legally use to meet the 2018 biofuel blending requirements. And yet that RIN bank has no impact on the price of the credits.
Many refiners have made smart business decisions and investments in biofuel production and blending capacity to capture the value of fuel diversification and the RFS program. For example, Flint Hills Resources has acquired several ethanol biorefineries and worked with biotech company Edeniq to launch new technology to produce cellulosic ethanol in those same facilities. The RFS was designed to support that type of innovation and it has been a success. Although it’s legal for refiners to comply with the program simply by purchasing RIN credits from others who innovate (and blend biofuels beyond the compliance targets), it isn’t necessarily a good business decision.
The RFS was designed to encourage biofuel blending. Biotechnology and biorefinery companies have invested hundreds of millions of dollars in advanced biofuel R&D and innovation. A new RIN credit price control scheme to reward such recalcitrance on the part of a few refiners will only disrupt the market and further derail new technology and investment in advanced and cellulosic fuels. Moreover, it’s likely to hurt rather than help small refiners.
Our recommendation for a win-win solution for oil refiners and the biofuel industry is for more oil to should invest in blending infrastructure and advanced and cellulosic biofuel production capacity to capture RIN credit values. The refiners can diversify their product offering and improve their competitiveness by working to meet the goals of the RFS, rather than digging their heels in against it. The benefit of improved energy security and market competition would also provide a win for U.S. motor fuel consumers.
James C. Greenwood is president and CEO of the Biotechnology Innovation Organization. He represented Pennsylvania’s 8th District in the U.S. House of Representatives from 1993 to 2005.
Read the original article: How Refiners Can Lower the High Price of Renewable Fuel Credits: Invest
December 14, 2017
By Tim Albrecht
Environment and Climate Change Canada released the preliminary Clean Fuel Standard regulatory framework Dec. 13, according to a press release from non-profit Renewable Industries Canada.
The goal of the proposed framework is to achieve 30 million metric tons (33.1 million tons) in GHG emissions annually by 2030, which contributes to the country’s effort to achieve an overall GHG mitigation target of 30 percent reduction below 2005 levels.
The clean fuel standard will establish lifecycle carbon intensity requirements separately for liquid, gaseous and solid fuels that are used in transportation, industry and buildings. This performance-based approach will incent innovation, development and use of a broad range of low carbon fuels, energy sources and technologies.
“Our association supports the government of Canada’s objectives and is encouraged that, in the short term, the CGS’s intensity based targets will be backstopped by existing biofuel mandates. This combination of policy levers will help ensure that heightened demand for biofuels is met by increased domestic supply,” said RICanada Chairman Jim Grey.
Scott Lewis, vice chair of RICanada, and executive vice president of biofuel producer BIOX Corp., said, “The domestic biofuel industry has grown to the point where it is now generating gross economic benefits in excess of $3.5 billion to the Canadian economy each year. This announcement will also bring to Canada a credit trading market for biofuels that is essential in our ability to continue to bring low carbon fuels to consumers at competitive prices, while allowing for some flexibility in compliance.”
The framework builds on existing policy that mandates the blending of 5 percent ethanol and 2 percent biodiesel into Canada’s transportation fuels. The 2010 mandates have reduced GHG emissions by more than 4 million tons per year, which is the equivalent of removing 1 million cars from Canada’s roads each year.
Greenfield Global, a producer of corn-based bulk industrial alcohol, packaged alcohol and fuel ethanol, President and CEO Howard Field welcomed the next stage of the process, saying, “By harnessing the benefits of biofuels within a clean fuel standard, Canada can make even stronger inroads in tackling climate change. We look forward to continued work with the Government on this ambitious policy.”
A copy of the Clean Fuel Standard regulatory framework is available here.
Read the original article: Canada Releases Clean Fuel Standard Framework
December 19, 2017
By Tim Albrecht
Japan is likely to finalize a determination in January 2018 that will allow the use of U.S. ethanol in the production of bio-ethyl tert-butyl ether. The determination comes after several committee meetings to assess how ethanol would meet Japan’s greenhouse gas emission’s requirement of 50 percent greenhouse gas (GHG) reduction.
The final decision will be followed by a period of public comment, after which implementation of the new regulation can occur as early as April of next year.
Japan’s Ministry of Trade, Economy and Industry began the assessment of the country’s biofuels policy from 2018 to 2022. METI formed an expert committee to discuss the future of biofuel introduction in Japan in March 2016. In 2017, the committee focused on GHG emission values of Brazilian and U.S. corn ethanol and gasoline.
In November, the committee discussed what methods can be put in place to ensure the sustainability of ethanol. For U.S. ethanol, the committee proposed the use of International Sustainability and Certification certificates and renewable identification numbers (RINs) to ensure traceability. The committee noted that the RIN can be used to trace ethanol back to ethanol plants.
Read the original article: Japan to Accept US Corn Ethanol
December 19, 2017
By Emily Druckman
WASHINGTON – Ten years ago today, Dec. 19, President George W. Bush signed into law the Energy Independence and Security Act, greatly expanding the scope and impact of the Renewable Fuel Standard (RFS). In the decade since passage, significant progress has been made towards greater energy security, cleaner air and boosting local economies, according to a new analysis by the Renewable Fuels Association, “The RFS2: Then and Now.”
The RFS requires oil companies to blend increasing volumes of renewable fuels with gasoline and diesel, culminating with 36 billion gallons in 2022.
“A decade after the RFS2 was adopted, tremendous progress has been made toward achieving the objectives of this landmark policy,” according to the analysis, which compares key data points from 2007 to 2017.
Among the highlights:
-The number of operational U.S. ethanol plants has nearly doubled from 110 in 2007 to 211 in 2017, a 92% increase, while U.S. ethanol production has grown 143% from 6.5 billion gallons in 2007 to 15.8 billion gallons in 2017;
-U.S. ethanol industry jobs grew 42% from 238,541 in 2007 to 339,176, with the value of industry output increasing 74% from $17.8 billion in 2007 to $31 billion in 2017;
-The production of advanced and cellulosic biofuel increased 469% from 490 million gallons in 2007 to 2.79 billion gallons in 2017;
-U.S. corn production grew 12% from 13 billion bushels in 2007 to 14.6 billion bushels in 2017, while corn acres planted fell 3% from 93.5 million acres in 2007 to 90.4 million acres in 2007 and average corn yields increased 16% from 150 bushels per acre in 2007 to 175.4 bushels per acre in 2017;
-The number of retail stations offering flex fuels like E85 increased 238% from 1,208 in 2007 to 4,077 in 2017, while the number of flex fuel vehicles on the road grew from 6.7 million in 2007 to 24.5 million in 2017, a 266% increase; and
-The greenhouse gas emissions avoided from using ethanol has increased 291% from 12.7 million tons CO2e in 2007 to 49.6 million tons CO2e in 2017.
Meanwhile, the doomsday outcomes threatened by RFS opponents have simply not materialized.
-U.S. cropland area fell 6% from 402 million acres in 2007 to 376 million acres in 2017, while U.S. grassland area has increased 5% from 1,296 thousand square miles to 1,359 thousand square miles.
-The deforestation rate in the Amazon fell 43% from 4,498 square miles in 2007 to 2,558 square miles in 2017;
-The greenhouse gas emissions from agricultural soil management, urea fertilization, and liming fell 7% from 278.7 million metric tons CO2e in 2007 to 260.1 million metric tons CO2e in 2017;
-Overall food inflation was 4% in 2007, but 1% in 2017;
-Prices for red meat, poultry, fish, cereals and bakery items, and dairy were unchanged in 2017 from the previous year, as compared to a 3.8% increase in 2007; and
-World grain supply for coarse grains, wheat, and rice increased 31% to 3.23 billion metric tons in 2017, as compared to 2.46 billion metric tons in 2007.
“By any measure, RFS2 has been a huge success, bringing about greater consumer choice while helping to make the air cleaner, stimulate economic activity and enhance energy security,” said Renewable Fuels Association President and CEO Bob Dinneen. “As this analysis shows, consumers have greatly benefitted from this vital program. These benefits have rippled throughout our economy and we look forward to even greater success of the RFS for years to come.”
The full analysis is available here.
Read the original press release: RFA Analysis Finds ‘Tremendous Progress’ Made Toward Meeting Energy, Environmental, Economic Goals of RFS2