US ethanol production in September plunged 102.2 million gallons from August to 983.9 million gallons, its lowest level since the federal Environmental Protection Agency started recording monthly biofuel production in July 2010, according to data released Thursday through the EPA Moderated Tracking System website.
The previous monthly low for ethanol production -- which is tallied under the EPA's renewable fuel (D6) category consisting of corn-based ethanol, the main type produced in the US -- was in February 2011, when it was at 1.051 billion gallons.
The record-low production figure, sources said, was most likely the result of numerous ethanol plant rate cuts and shutdowns.
One such shutdown was a plant of Abengoa's, which confirmed in early October that it had temporarily shut its 88 million gal/year ethanol plant in Madison, Illinois, for maintenance.
Monthly biodiesel production for September, indicated in the biomass-based diesel (D4) category by the EPA, fell for the fourth consecutive month as it shrank 8.638 million gallons, or 5.5%, to 147.02 million gallons. Monthly biodiesel production has not been this low since February, when it was at 116.9 million gallons.
The slowing biodiesel production caused biodiesel Renewable Identification Number, or RIN, prices to shoot up recently, sources said. The Platts assessment for 2012 biodiesel RINs was at $0.70/RIN Wednesday, the highest level since October 2. Since being assessed October 10 at a 2012-low of $0.4250/RIN, 2012 biodiesel RIN assessments rose 27.5 cents/RIN, or 65%, over the course of a week.
A RIN is a number issued by the EPA for the purpose of tracking renewable fuel usage throughout the supply chain; refiners, importers and blenders, called "obligated parties," use them to show the EPA they have fulfilled their mandated government use of renewable fuels. If the obligated party has not used enough physical product, such as ethanol, it can satisfy the quota by purchasing RINs. For biodiesel, the RIN serves the same purpose, but is biodiesel-specific.
Monthly advanced biofuel (D5) production -- mostly comprising ethanol derived from feedstock sugarcane -- for September eased off of the previous month's record high, dropping 8.197 million gallons, or 9.5%, to 78.012 million gallons.
