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LCFS hits new high as 2016 mandate looms

The PRIMA California LCFS Index finished Wednesday at a new historical high of $83.50, with buyers pushing their best bid to $82 for Q4 transfer and $81 for Q1 transfer. Offers kept to the previous day’s level at $85. LCFS prices have now stood above $80 since October 20 with the week’s average price sitting at $82.50.

California October refinery fuel output remains much slower than month ago levels. Weekly state refinery production data showed California CARB ULSD refinery output gained 6.2% WoW, still languishing 16% below month ago levels. Total production of gasoline in California sits at 28.6mn bl so far in October, down 7.6% MoM.

Valero said Wednesday the firm expects to see healthy gasoline demand through the fourth quarter. Valero meanwhile continues to evaluate renewable diesel expansion opportunities ‎after low ethanol prices drove Q3 ethanol operating profits down 75%. Valero and renderer Darling Ingredients currently operate a 11,000b/d renewable diesel plant at Norco, LA.

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