Farm Credit Council asks if banks will “sit back and wait for someone else to take the financing risk to get the industry up and running”
December 31, 2007
The Farm Credit Council said that, following the singing of the Energy Independence and Security Act, that US industry will require $105.5 billion in capital to meet the new Renewable Fuel Standard.
Council director Ken Auer questioned whether commercial bankers would “sit back and wait for someone else to take the financing risk to get the industry up and running”.
Auer referred to a banking industry study that showed that commercial banks or private institutions generated about $2 billion of new debt per year for the industry, compared to the more than $10 billion per year that will be required.”
Multiple ethanol projects have been shelved or postponed in the US this year due to tightening credit conditions, as well as shrinking ethanol margins.
Cato Institute says “If you want to be president and you’re running in the Iowa caucuses, you have to support ethanol.”
December 31, 2007
Jerry Taylor of the Cato Institute says “If you want to be president and you’re running in the Iowa caucuses, you have to support ethanol.” Among major candidates, only John McCain has been strongly opposed to ethanol subsidies, but points out that he is opposed to all subsidies, even those which benefit his home state.
A Zogby poll in Iowa shows, among Democrats, Sen. Hillary Clinton, leading former Sen. John Edwards and Sen. Barack Obama by four points, 30 percent to 26 percent. Sen. Joseph Biden and Gov. Bill Richardson were at 5 percent. Sen. Chris Dodd and Rep. Dennis Kucinich were at 1 percent each.
On the Republican side, Gov. Mike Huckabee was at 29 percent support, former Gov. Mitt Romney at 27 percent, and Sen. John McCain was moving up at 13 percent.
Former Sen. Fred Thompson was at 8 percent, former Mayor Rudy Giuliani and Rep. Ron Paul stood at 7 percent each.
Biofuels Digest Indexâ„¢ jumps 1.70 percent to 52-week high of 135.83 as Archer-Daniels-Midland surges
December 31, 2007
The Biofuels Digest Indexâ„¢, a basket of public biofuels stocks, rose 1.70 percent on Friday to close at a 52-week high of 135.83. Archer Daniels Midland (ADM), up 2.28 percent to $47.09. led the way as investors continued to embrace biofuels in the wake of the signing of the Energy Act.
Mid cap ethanol, stocks were generally down on the day, eld by VeraSun Energy (VSE), down 4.07 percent to $15.09. Among small caps, BioSolutions Manufacturing (BSLM.OB) was off 17.95 percent to close at $0.032.
Today in Biofuels: Trends to Watch for 2008; What Bali Means to You; $150 oil?
December 28, 2007
Top Story:
As lead story in our Year End Edition, Biofuels Digest published its Trends to Watch for 2008.
Producer News:
Biofuels Digest published a short report on producer and financial trends, titled “Think Sustainable, Not Renewable”.
International News:
Balloting is continuing for the Biofuels Digest Biofuels Personality of the Year. Voting continues through December 31st, when the winners will be announced.
Research News:
Biofuels Digest analyzes the energy self-sufficiency of the 50 US states in its state-by-state “Oil Independence Report”.
Policy and Policymakers:
Biofuels Digest prepared a report on the outcomes from the 13th UN Conference on Climate Change, titled “What Bali Means to You”.
Consumer and Fleet News:
The Money and Markets newsletter predicts $150 oil by the end of 2008, in comparison to a price prediction of $105 per barrel from Goldman Sachs and $85 from the Energy Information Administration.
Financial News:
The Biofuels Digest Indexâ„¢, a basket of public biofuels stocks, rose 0.35 points today to close at 133.56.
Money and Markets predicts $150 oil by end of 2008
December 28, 2007
The Money and Markets newsletter predicts $150 oil by the end of 2008, in comparison to a price prediction of $105 per barrel from Goldman Sachs and $85 from the Energy Information Administration.
The International Energy Agency released a report projecting a severe energy supply shortage by no later than 2015. The report warned that increasing energy demand in India and China would result in an oil shortage of up to 7 million barrels of oil per day.
Global annual consumption of 85 billion barrels, is expected to reach 118 billion barrels by 2030. Matthew Simmons, a Houston oil and gas investment banker, told the Associated Press that the price of crude oil is likely to reach $300 a barrel. Oil prices reached a record $98.62 per barrel last month.
In China, fuel riots have occurred because of shortages. The shortages are affecting Shanghai, the southeast coastal provinces, and are spreading to the interior. Diesel is fixed-priced at $2.42 in China, about one third of the price in European markets, and fuel companies are getting squeezed by soaring crude oil costs, leading to production cutbacks and allocations. Prices have not been raised for 17 months despite crude oil rices nearly doubling.
European biodiesel industry slammed by soaring costs, loss of green group support, production glut, loss of tax breaks and US competition
December 28, 2007
The Wall Street Journal provides coverage of problems in the European biodiesel industry, including a production glut, soaring costs, loss of support from green groups over the use of Malaysian and Indonesian palm oil, the cancellation of tax breaks by national governments, competition from subsidized US biodiesel, and a B5 blend wall.
European biodiesel now costs $4.80 to produce, compared to $2.80 per gallon for conventional diesel. European observers say that the problem is producing a commodity in the high-cost European zone, and that Europe ultimately must import its biodiesel.
Thailand’s PTT to market E20, offer $0.75 per gallon discount to unleaded gasoline, in bid to reduce oil use
December 28, 2007
In Thailand, PTT said it will supply E20 blended fuel to its customers, and price the fuel at a $0.75 per gallon discount to regular unleaded gasoline.
The move is designed to stimulate use of ethanol and reduce Thailand’s dependence on imported oil.
Kansas consumers to test E20, E30 and E50 in pilot project to study fuel efficiency
December 28, 2007
The Kansas Department of Agriculture has launched a project to offer flex-fuel vehicle owners a choice of E10, E20, E30, E50 and E85 at selected service stations, and will study the fuel efficiency.
A study by University of North Dakota and University of Minnesota researchers released earlier this month showed that cars achieved higher fuel efficiency compared to unleaded gasoline when running on E30.
Biofuels Digest Indexâ„¢ gains 0.35 percent to reach 52-week high of 133.56
December 28, 2007
The Biofuels Digest Indexâ„¢, a basket of public biofuels stocks, closed Thursday at 133.59, up 0,35 as the Index reached a new 52-week high of 133.56. The Index has risen more than 38 percent since October 3rd in the wake of improving ethanol margins and the signing of the Energy Independence Act.
Among large cap diversified agribusiness, Archer Daniels Midland (ADM) rose 0.63 percent to close at $46.04, while mid cap ethanol stocks were generally down slightly on the day, with VeraSun Energy (VSE), down 3.2 percent to $15.73, leading the decliners. Overall, winners and losers were even for the day.
US biodiesel production plunges to 22 percent of capacity; feedstock costs, low demand are culprits
December 28, 2007
The National Biodiesel Board reports that US biodiesel producers are operating at 22 percent of their 1.85 billion gallon capacity, due to high feedstock prices and low demand from petroleum marketers. The NBB said that US biodiesel production would reach 400 million gallons in 2007.
The group said that the United States produced 250 million gallons out of a capacity of 580 million gallons in 2006, or 43 percent of capacity. The new US Renewable Fuel Standard mandates that petroleum marketers blend a minimum of 500 million gallons of biodiesel in 2009.
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