Recent EIA data and academic research show that ethanol consumption remains robust and on track to outpace last year’s numbers, even despite small refiner exemptions (SREs) and falling RIN prices. So much for the long-held claims of ethanol demand destruction … we hope … but surely there must be a bogeyman out there somewhere, right?
In fact, a new one has emerged just in time. The ethanol demand destruction myth is now facing competition from a fresh face: The claim that SREs and falling RINs are causing demand destruction to biodiesel. Brace yourself for another round of house-on-fire hysteria.
Yet a close examination of both the facts and history of the biodiesel mandate warns us against crying wolf once again. The stubborn fact remains that domestic biodiesel production is up compared to last year. And if in fact the product is in some way falling short of its potential, the more fair-minded out there would note that U.S. trade policy and a lack of clarity over the federal biodiesel tax credit would be lead factors in creating market uncertainty... Click to Read Full Post