Renewable Diesel and Biodiesel

by Bruce Comer, Ocean Park Advisors More industry players chose to develop and build new capacity rather than buy plants The North American biofuels industry experienced the fewest merger and acquisition transactions in recent history in 2017. There were only six M&A transactions, with a total estimated value of more than $100 million. They involved eight plants with 297 million gallons per year (MGPY) of production capacity. Half of these deals were for non-operating plants. A fourth deal was for a sub-scale demonstration plant. Contributing to the limited deal flow, two historically active acquirers, Green Plains and REG, did not close...

By Tom Konrad, Ph.D., CFA Because of rising fertilizer prices, farmers are planting more soybeans than corn.  Soybeans are a legume, meaning that they can fix their own nitrogen in the soil, meaning that they need less nitrogen fertilizer, the price of which is spiking due to rising natural gas prices.  Corn, in contrast, needs more nitrogen than most other crops.   High gas prices are rising because of Putin’s war on Ukraine, which is also preventing Ukrainian farmers from planting this year’s wheat crop, while sanctions are likely to disrupt wheat supplies from Russia as well. Corn and (to a lesser extent,...

by Helena Tavares Kennedy The seasons are changing in many parts of the world right now, but what really is changing this autumn is how the world is looking at renewable diesel. Phillips 66 and REG’s announcement about a new renewable diesel plant on the U.S. West Coast planned for 2021 comes after a notable increase in refineries that are being converted and changed over to renewable diesel. Change is good, especially in this case. As Bob Dylan sang, “For the loser now, Will be later to win, For the times they are a-changin’.” And who knew he was singing about the RFS...

Aemetis, Inc. (AMTX:  NasdaqCM) just announced sales of biodiesel to gas stations in India.  The sales follow on the heels of a significant ruling in November 2018, by the Bombay High Court to remove restrictions on biodiesel that had barred direct to consumer sales by biofuel manufacturers.  The breakthrough into the India market is significant for the company, which has been operating a 50-million gallon integrated chemicals and fuels facility in Kakinada, India for several years.  Demand for renewable fuels has been strongest among fast growing economies like India, where decision makers fear dependence upon imported fossil fuels.  India produces only about 1% of global...

Yay or Nay for EPA? RFS Volumes out for 2020, Biodiesel for 2021 – What’s the reaction from industry? by Jim Lane What’s the reaction from industry? Coal for Christmas? Should Santa bring coal for EPA’s stocking this year? Do the biofuels and agriculture industries think the EPA just put coal in their stocking? Is it thumbs up or thumbs down from biofuel industry advocates on last week’s U.S. Environmental Protection Agency renewable fuel volumes? What about the exempted volumes? The Ruling – Rotten or Respectable? First, a bit on the EPA ruling that establishes the required renewable volumes under the Renewable Fuel Standard (RFS) program for...

Challenges and Opportunities in Biofuels By Steve Hartig, Former VP of Technology Development at ICM The North American biofuels market can be split into three main segments all of which have major dynamics.  What I would like to do is give a high-level overview of what I see as some of both the challenges and opportunities across these. Ethanol which is a produced from corn and sorghum in about 200 plants mainly across the Midwest and blended at about 10% with gas.  Majors such as POET, Green Plains, Flint Hills, Valero, ADM and Cargill do a bit more than half of the 16...