The U.S. is importing biodiesel at a record rate for the year so far. This article from Platts cites U.S. Census Bureau data that shows imports reached a 2014 year-to-date record in July of 69,474 metric tonnes, more that twice the previous record set in March. Low palm oil prices seem to be the big driver, although biodiesel imports are far below last year’s overall levels when reinstatement of the $1-a-gallon federal tax credit made it profitable for blenders.
The top origin for US biodiesel imports in July was Indonesia at 24,043 mt, up 60% from the previous month and the highest since December 2013 when 52,350 mt were imported.
Traders attributed the surge in imports from Indonesia to lower palm oil prices.
A couple of producers from Indonesia are already registered with the EPA and would be capable of generating RINs if they ran an approved feedstock. Although palm oil has not been approved as an eligible feedstock to generate RINs under RFS2, grandfathered biodiesel plants — construction of which started prior to December 19, 2007 — can assign RINs with a D6 code to palm oil-based biodiesel if they keep up with the appropriate documentation.
Also, for the first time this year, imports from Argentina were recorded at 18,217 mt. A massive 441,772 mt were imported from Argentina in 2013.
More imports are seen coming from Argentina – a sign traders are pretty confident the blender’s credit will be restored and made retroactive. Political watchers believe that restoration could happen after November’s elections.