Does the Biodiesel Tax Credit Change the Advanced Biofuels Landscape?
(FarmDocDaily) …The RFS for 2013 is expected to require a minimum blending of 1.28 billion gallons of biodiesel and 2.75 billion gallons of all advanced biofuels. The difference between the minimum biodiesel requirement and the minimum total requirement is referred to as undifferentiated biofuel. That requirement can be met by Brazilian ethanol, biodiesel, or cellulosic ethanol. Since cellulosic ethanol is not available in any substantial quantities, the requirement will be met by either Brazilian ethanol or domestic biodiesel.
…Since those earlier posts, the $1.00 per gallon blenders’ tax credit for biodiesel has been reinstated for 2013 (retroactive to 2012). On the surface, the availability of the tax credit would seemingly swing the economic advantage for meeting the undifferentiated biofuels component of the RFS in 2013 away from Brazilian ethanol to domestic biodiesel. If so, Brazilian ethanol imports in 2013 would be less than previously forecast and possibly close to zero; domestic biodiesel production would be larger than previously forecast and as large as 1.833 billion gallons; and domestic ethanol production would be larger than previously forecast and as large as 14 billion gallons. READ MORE