The EIA’s December Biodiesel Production Report that was released last week, showed that US biofuel plants produced 146 million gallons of B100 during the month of October. Monthly production peaked back in July at 150 million gallons, and has since settled slightly lower every month since, even as biodiesel imports have fallen sharply. However, monthly production totals have been record large since April, and Jan-Oct output is also the largest since the EIA began reporting the data in 2010.
There were 98 biodiesel plants on line during the month, with annual capacity of 2,340 million gallons. The total capacity was down slightly from September, as 1 plant in Texas was taken offline; but compared to a year ago, total capacity was up 14%. The monthly production figure implies capacity utilization at 75%.
Biodiesel demand, like production, appeared slightly weaker at the start of the 4th quarter. Producers reported monthly sales of 54 million gallons of B100, with a another 90 million gallons that were marketed through biodiesel blends. Total B100 sales for the month of 144 million gallons, were unchanged from September and just 3 million gallons larger than a year ago.
B100 stocks have been record large since March, and the slower demand profile through October raised B100 stocks to a 5 month high of 51 million gallons, 13 million gallons more than a year ago, and also a record large October stocks figure.
Biofuel plants told the EIA that they used 577 million pounds of soyoil for biofuel production during the month of October, a record large figure for the month, but also a surprising turn down. While soyoil use ticked down, combined use of other feedstocks reached a new record high of 671 million pounds. Soyoil has been the preferred feedstock, but biofuel plants have also expanded use of other fats and oils. Canola oil use reached a new record high of 159 million pounds in October, while plants also used 112 million pounds of animal fats, and 130 million pounds of recycled vegetable oils. Corn oil use has also steadily increased in recent years, rising from just 3-4 million pounds per month in 2010, to 132 million pounds in October. Increased corn oil use has developed as US ethanol plants have invested in equipment to extract oil from DDG’s.
With a slightly larger biofuel mandate in 2018 and lower US biodiesel import, use of all feedstocks in the US are expected to push to new all time highs in the months ahead.