The US ethanol industry outlook remains strong as production, exports and blending reach record highs, according to Renewable Fuels Association (RFA) president and CEO Bob Dinneen, the ethanol industry’s trade group and lobby.
Dinneen, who was addressing the audience at the RFA’s 23rd Annual National Ethanol Conference in San Antonio, Texas, described the prior year as a success despite the continued push back the industry has received from Washington, D.C.
The RFA chief highlighted a 3% YoY rise in domestic production levels, as 2017 totals registered 15.8bn gallons of ethanol from 211 ethanol plants across 28 states, while the national blend level exceeded 10% as E15 and E85 sales soared.
Dinneen went on the add record level U.S. ethanol exports, which climbed to 1.4bn gallons, with shipments reaching more than 60 countries.
While 2017 represented an exceptional example of US ethanol’s impact and economic potential, Dinneen cautioned those in attendance about the unrelenting efforts of the oil industry to undercut the ethanol industry’s successes.
“The bottom line is this: There is no reason for the ethanol industry, or its champions in Washington, to accept demand destruction as a necessary or legal path to the future to accommodate the failed business plans of a few independent refiners,” Dinneen said, adding that the facts, and the President, are on ethanol’s side.
While the most recent year represented a realization of domestic ethanol prosperity, the D4/D6 RIN spread narrowed to near yearly lows, as ethanol RIN value shrank ahead of ballooning physical production.
The D4/D6 RIN spread, which averaged nearly 20 points/RIN in 2015, fell nearly 50% in 2016 to 10.10 points/RIN, its lowest yearly average since 2014, when the D4/D6 RIN spread hit 8.62 points/RIN.
Through the first seven weeks of 2018, the D4/D6 RIN spread has regained some of its lost 2016 value, reaching 13.13 points/RIN, due largely to rebounding D4 RIN prices, which hit 91 cents/RIN in mid-February, a near two month high.