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US regulatory clarity vital to sustain biofuels growth

  • Market: Biofuels
  • 17/09/24

Clarity from both US state and federal regulators regarding the rules and incentives for biofuels production is essential to ensure continued growth to achieve underlying carbon-reduction targets, industry stakeholders said today.

A lack of guidance for incentive programs and qualifications for 2025 and beyond is already hindering trade and investment in key US biofuels markets, panelists said today at the Argus North American Biofuels, LCFS and Carbon Summit in Monterey, California. The current biodiesel tax credit (BTC) is scheduled to give way to the Inflation Reduction Act's Clean Fuels Production Credit (CFPC) in January, while narrowed proposed targets and credit qualifications in state Low Carbon Fuel Standard (LCFS) programs has effectively left key portions of the biofuels market in a holding pattern.

Alignment and certainty between regulatory bodies on what will be incentivized and credited in the future will be an essential component of business and investment decisions in the industry, necessary to reach ambitious carbon-reduction targets within the next decade.

"The fact that we don't have clarity mid-September for a tax credit going into effect on 1 January, is really hard to believe," said Kurt Kovarik, vice president of federal affairs for Clean Fuels Alliance America. "No one knows the rules of the road with respect to 45Z."

Panelists echoed opposition to proposed California caps on crop-based renewable feedstocks that discussed on Monday at the conference during sustainable aviation fuel (SAF) discussions.

"If the goal is to remove carbon, the extent to which we can base it on science and not pick winners and losers is in everyone's interests," Kovarik said. "All you're going to end up doing is limiting the driving out of carbon."

But speakers today further warned of the potential for a duplication of efforts by parties trying to satisfy both state LCFS programs and the federal Renewable Fuel Standard program. Proposed requirements may also require an unprecedented level of collaboration between segments of the US renewables supply chain.

Those requirements could be more disruptive than the feedstock cap itself and potentially have the greatest limiting effect on fuel supply into California, said Don Gilstrap, Chevron's manager of fuels regulations.

With that goal in mind, declining carbon intensity targets are already providing the necessary incentive for producers to pivot away from crop-based renewable feedstocks, Gilstrap said.

But panelists were optimistic about rising interest in replicating LCFS-style focuses on carbon intensity — an approach they theorized would "unleash innovation" across both the finished fuels and feedstocks segments of the industry.


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10/03/25

US SAF projects will be protected: United Airlines

US SAF projects will be protected: United Airlines

Houston, 10 March (Argus) — US sustainable aviation fuel (SAF) projects will move forward despite the US administration pushing back against earlier legislation that supports renewables, the head of United Airlines said today. SAF has bipartisan support in Congress and at the state level and is likely to be protected, United chief executive Scott Kirby said at the CERAWeek by S&P Global conference in Houston, Texas. Electrification is not practical in large scale aviation and hydrogen has a different set of problems, leaving SAF as the better option, Kirby said. The US has provided strong incentives to develop SAF under laws passed during the administration of former-president Joe Biden and will likely produce enough to export to Europe to help that continent meet aggressive targets. US president Donald Trump issued an executive order upon taking office which paused all disbursements of funds appropriated through the Inflation Reduction Act (IRA) passed in 2022 and a complementary infrastructure law passed in 2021. The order called for ending the "Green New Deal", echoing language he used on the campaign trail when criticizing the IRA. Trump said the funding should be held back until federal agencies "review their processes, policies and programs for issuing grants, loans, contracts or any other financial disbursements" to ensure they fit with policy objectives. United announced in December that it agreed to buy SAF from Phillips 66's Rodeo facility in northern California as soon as the product came online. The airline inked a similar deal with Neste last year for SAF as it continues to take advantage of the Illinois SAF buyers' tax credit in supplying its major hub at Chicago's O'Hare International Airport. Other US independent refiners have recently announced that SAF projects are advancing. Specialty refiner Calumet said last month that a project to expand SAF production in Montana is moving forward after it received an initial $782mn loan from the US Department of Energy (DOE). The funding is the first portion of a $1.44bn loan from the DOE that will allow Calumet subsidiary Montana Renewables to expand operations at its Great Falls, Montana, biofuel plant. The loan was paused temporarily earlier this year as the Trump administration conducted a review to confirm "alignment with White House priorities." Another US independent refiner, Par Pacific, said it is seeing strong interest in its planned renewable fuels facility at its 94,000 b/d Kapolei, Hawaii, refinery. The $90mn project, which will produce SAF and other products, is on schedule to start up in the second-half of 2025, Par Pacific said. Meanwhile, US independent refiner Valero said recently that its project to produce up to 15,000 b/d of SAF at its refinery in Port Arthur, Texas, is fully operational. The project allows the plant, jointly owned with Diamond Green Diesel (DGD), to upgrade up to 50pc of its 31,000 b/d renewable diesel refining capacity to SAF. By Eunice Bridges Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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News

Brazil's GDP growth accelerates to 3.4pc in 2024


07/03/25
News
07/03/25

Brazil's GDP growth accelerates to 3.4pc in 2024

Sao Paulo, 7 March (Argus) — Brazil's economic growth accelerated to an annual 3.4pc last year, the fastest growth since 2021, as gains in the services and industry sectors offset contractions in the agriculture sector, according to government statistics agency IBGE. Growth accelerated from 3.2pc in 2023 and 3pc the prior year. Growth was at 4.8pc in 2021 as the economy recovered from the Covid-19 induced contraction of 3.3pc in 2020. Agriculture contracted by 3.2pc in 2024 after a 15.1pc gain the year prior. The sector's weak performance came as Brazil faced extreme climate events last year that damaged crops , IBGE said. Corn and soybean output fell by 4.6pc and 12.5pc, respectively, according to IBGE. The industrial sector grew by 3.3pc last year after a 1.6pc gain in 2023. Manufacturing industries rose by 3.8pc, driven by a higher output of vehicles, transport equipment, machinery and electric equipment, according to IBGE. Electricity and gas, water and sewage management increased by 3.6pc in 2024 but still decelerated from a 6.5pc gain a year earlier. Higher temperatures throughout 2024 drove the increase, IBGE said. On the other hand, the climate was unfavorable for power generation. The oil, natural gas and mining industry grew by 0.5pc in 2024 from a year earlier. Gross fixed capital formation — which measures how much companies increased their capital goods — rose by 7.3pc from a 3pc contraction in 2023, led by higher domestic output and capital goods imports. Exports rose by 2.9pc, while imports rose by 14.7pc last year. Investment grew by 17pc. Household consumption increased by 4.8pc from a year prior, driven by a 6.6pc unemployment rate — the lowest registered since IBGE started its historic record in 2012 — federal social aid programs and increased lending. Government spending rose by 1.9pc in 2024 from a year earlier. Quarterly GDP Brazil's GDP growth slowed to an annual 3.6pc in the fourth quarter from 4pc in the third quarter, with several sectors contracting, according to IBGE. Agriculture contracted by an annual 1.5pc in the fourth quarter, with 2.9pc and 0.9pc contractions in the wheat and sugarcane crops, respectively, IBGE said. But the industrial sector grew by an annual 2.5pc in the quarter. Manufacturing posted 5.3pc growth, led by the steel sector and higher output of machinery, equipment, vehicles and chemicals. The services sector grew by 3.4pc. The oil, natural gas and mining industry contracted by 3.6pc from a year earlier thanks to a decrease in oil, gas and iron output, IBGE said. Electricity and gas, water, and sewage management fell by an annual 3.5pc, on lower power consumption as power rates became more expensive amid a drought that struck the country in mid-2024. Household consumption grew by an annual 3.7pc, while government spending grew by 1.2pc in the fourth quarter. Gross fixed capital formation increased by an annual 9.4pc in the fourth quarter, according to IBGE. Exports fell by 0.7pc, while imports, which subtract from growth, rose by 16pc. By Maria Frazatto Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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St Louis harbor water levels to improve


04/03/25
News
04/03/25

St Louis harbor water levels to improve

Houston, 4 March (Argus) — Water levels at the St Louis, Missouri, harbor are forecast to rise above 0ft this week, the National Weather Service (NWS) said, allowing for easier barge transit at the harbor after weeks of low water concerns. St Louis is forecast to receive multiple rounds of showers and thunderstorms today, including some hail, with around 1 inch of precipitation expected to pour over the greater St Louis area, according to the NWS. As water from the tributaries reaches the harbor into this weekend, levels as high as 10.7ft are expected by 11 March. This rain is long awaited as the St Louis harbor has been grappling with low water conditions since early January. These conditions were exacerbated by minimal rainfall in February, causing water levels to fall below -3ft at the terminal. Some barge carriers will finally be able to resume loading at their docks after calling off all barge movement due to the low water. Draft restrictions are anticipated to slowly loosen in the coming days as water levels rise, and more weight can be placed on barges. Current draft restrictions are between 9.6-10ft at St Louis. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Australia should incentivise renewable fuels: Lobby


04/03/25
News
04/03/25

Australia should incentivise renewable fuels: Lobby

Sydney, 4 March (Argus) — Australia's growing dependence on oil product imports may continue if a domestic renewables fuels sector is not incentivised shortly, as feedstocks will increasingly become contracted elsewhere, domestic bioenergy lobby Bioenergy Australia (BA) said. BA is calling for greater government direction for the sector, highlighting the A$6bn/yr ($3.7bn/yr) in feedstocks that the nation exports. BA released the Securing our Fuel Future report ahead of Australian Renewable Fuels Week in Sydney, which began on 4 March. BA's report said a reliance on Singapore, South Korea and China for key product imports posed a risk to the economy and national defence, with 80pc of Australia's liquid fuel demand by 2050 to be concentrated in critical hard-to-electrify sectors such as aviation, heavy freight and mining, with major customers supporting domestic low-carbon fuel refineries to meet demand and ensure secure supply. But Australia's government has been slow to progress incentivising renewable fuels, despite promising a certification scheme for low-carbon liquid fuels, including sustainable aviation fuel (SAF) and renewable diesel in last year's federal budget. BA has said 60pc of Australian jet fuel demand could be met by turning locally-produced inputs such as tallow into SAF, providing a decarbonisation option for the hard-to-abate sector, but proposed projects remain in the development stage. A pipeline of proposals to produce renewable diesel (RD) and SAF exist, which would help Australia build on its existing ethanol and biodiesel sectors, with the report contrasting this with the nation's declining crude production and the unsuitability of remaining local grades for Australia's refiners. Australia's small biofuels industry is operating below capacity, based on 2022 figures of just 175mn litres/yr (l/yr) of ethanol produced. Output could rise to 436mn l/yr or about 2.7pc of Australia's 2024 gasoline consumption of 16.25bn l by utilising this capacity, the paper found. Similarly, just 1.5mn l of biodiesel was produced in 2023 despite capacity for 110mn l/yr, indicating the potential for rapid scale-up if fuel security interruptions occur. Australia's feedstock capacity of agricultural products and residues, tallow, used cooking oil (UCO), solid wastes and forestry products represent 40 times its annual fuel requirements, compared to the US and Brazil at three times, meaning it could provide stable market supply. New Zealand, which has lacked a domestic refining capacity since 2022, last week released two reports into its own fuel security. They found that increased storage and uptake of zero-emission vehicles would be preferable to reopening its shuttered 135,000 b/d refinery, while recommending further study into SAF and RD. By Tom Major Australian biofuels projects State Fuel type Capacity (mn l/yr) Feedstock Wilmar Sugar Sarina biorefinery Queensland ethanol 60 Molasses Manildra Group Shoalhaven Starches New South Wales ethanol 300 Wheat starch Dalby biorefinery Queensland ethanol 76 Red sorghum Eco Tech biodiesel Queensland biodiesel 30 Waste streams Biodiesel Industries Australia New South Wales biodiesel 20 UCO Just Biodiesel Victoria biodiesel 60 Tallow, UCO Source: Deloitte Dalby biorefinery ceased production in 2020 Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Ethanol exports drive more US Jan corn demand


03/03/25
News
03/03/25

Ethanol exports drive more US Jan corn demand

St Louis, 3 March (Argus) — US corn use for ethanol returned to above year-ago levels in January, as ethanol production continued to keep pace with export demand. US corn use for ethanol production reached 457mn bushels in January, according to US Department of Agriculture (USDA) data, 4pc above January 2024 levels. Corn use in ethanol has remained near or above year-ago levels since July 2023, following escalating US ethanol export demand. US ethanol exports reached 25.5mn bl through January of the 2024-25 marketing year, 37pc more than the same period over the prior year according to US Energy Information Administration (EIA) data. Through January, US ethanol production used 2.3bn bushels of US corn, 2pc above the prior year and on track to reach the 5.5bn bushels mark for the 2024-25 marketing year currently projected by the USDA. By Ryan Koory Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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