Biofuels and feedstocks
Overview
Demand for biofuels is increasing significantly, driven by the need to decarbonise road transport as part of the energy transition. Global biofuels output is expected to rise by more than 3mn b/d in the next five years, and such rapid growth means that new challenges and opportunities are constantly emerging. Keeping on top of the ever-changing biofuels landscape requires accurate pricing, insightful analysis and access to the latest data.
The Argus biofuels solution provides in-depth pricing and market analysis across the entire global renewable fuel supply chain, from original feedstock to finished fuel, with prices and key insights into regional biodiesel, ethanol and feedstock markets.
Latest biofuels news
Browse the latest market moving news on the global biofuels industry.
EcoCeres, British Airways sign SAF supply agreement
EcoCeres, British Airways sign SAF supply agreement
Singapore, 1 July (Argus) — Hong Kong-based biofuels producer EcoCeres has signed a multi-year agreement to supply UK's British Airways with sustainable aviation fuel (SAF), it announced on 30 June. The SAF is expected to help the airline reduce life cycle carbon emissions by approximately 400,000t, compared with using the same volume of conventional jet fuel, EcoCeres said in its press release. This reduction is also equivalent to the total emissions from flying around 240,000 economy class passengers on return flights between London and New York. EcoCeres declined to share the SAF volumes or time period agreed in the supply deal. British Airways has committed to fuelling 10pc of its flights with SAF by 2030. SAF accounted for 2.7pc of its total fuel use in 2024, and has contributed to a 13pc reduction in carbon intensity since 2019, said the company's director of sustainability Carrie Harris. EcoCeres operates a 350,000 t/yr SAF and hydrotreated vegetable oil (HVO) plant in Jiangsu, China. Its planned SAF and HVO plant in Johor, Malaysia, has a maximum production capacity of 420,000 t/yr and is expected to come on line in the fourth quarter of 2025, market participants said. EcoCeres also manufactured the 500,000 litres of used cooking oil (UCO)-based SAF delivered to Air New Zealand in June 2024 . The SAF was supplied and blended by ExxonMobil. By Sarah Giam Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
US Senate bill cuts 45Z extension, boosts crops
US Senate bill cuts 45Z extension, boosts crops
New York, 30 June (Argus) — The latest Senate draft of a major US budget bill would extend a biofuels tax break for an additional two years, down from four years in the prior draft, and set far more sweeping limits on foreign feedstocks. The "45Z" clean fuel production credit would last until 2029 and be available for only domestically produced fuels produced from North American feedstocks starting next year, according to a draft released over the weekend by Senate leaders that could be voted on as soon as Monday. An earlier Senate draft proposed extending the incentive through 2031 and cutting credit values for foreign feedstocks by just 20pc. The incentive, part of the Inflation Reduction Act, kicked off this year and currently offers a sliding scale of subsidy to US-made alternative fuels through 2027 based on their greenhouse gas emissions. The updated language is a win for farm groups, which have worried that imports of used cooking oil, tallow, and sugarcane ethanol are hurting demand for home-grown crops that can also be turned into biofuels. Refiners that had previously looked abroad for renewable diesel inputs, expanding US production to record levels last year, would have to pay up for scarcer domestic options. A shorter credit extension could frustrate corners of the industry that had emphasized the need for policy certainty — including companies with plans to start producing novel fuels later this decade — although biofuel incentives have a long history of extensions. For instance, the Senate bill would revive an expired tax credit for small biodiesel producers in a major change from earlier drafts. Facilities with capacities of no more than 60mn USG/yr could claim a 20¢/USG subsidy for up to 15mn USG of annual production this year and next year, supplementing tax breaks they can already claim under 45Z. That could keep more biodiesel plants, which have struggled to adapt to policy changes and competition from larger renewable diesel producers, running after a difficult start to the year. Smaller producers also would benefit from the latest Senate draft preserving the ability of companies without enough tax liability to sell tax credits to others. The bill is otherwise similar to earlier versions. It would still bar regulators next year from considering indirect emissions from land use changes, a shift from current law that in effect ups subsidies for fuels made from crops, another top priority for farm groups. If passed, the typical gallon of US dry mill corn ethanol and canola biodiesel would likely qualify for some 45Z subsidy — unlike under current rules — and soybean-based road fuels would earn larger credits next year. Aviation fuels conversely would see slimmer subsidies starting next year, since the bill would eliminate extra credit under current law for jet fuels over road fuels. That would be a major disruption to airlines and to those refiners that have invested in upgrading more of their renewable diesel output to instead produce sustainable aviation fuel (SAF). Trucking groups had argued that the imbalance was diverting feedstocks away from road markets to costlier SAF production — and that treating fuel types equally was one way conservative lawmakers could reduce the credit's price-tag. More changes possible The bill could be changed further Monday as the Senate proceeds with a process in which lawmakers can propose amendments. If the bill passes, it would go back to the House for approval. President Donald Trump has pushed lawmakers to finalize the sprawling package this week, an ambitious timeline given lawmakers still disagree on key issues. Any revised 45Z credit would also need final rules from the US Department of Treasury, which still has questions to answer about eligibility this year. The ultimate profitability of biofuels will depend on interactions between the tax credit and other policies that are also in flux. That includes a federal biofuel blend mandate, which the Trump administration wants to revamp to discourage foreign feedstocks, and newly tougher carbon intensity targets in California's influential low-carbon fuel standard market. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
US Senate to vote on $3 trillion energy, tax bill
US Senate to vote on $3 trillion energy, tax bill
Washington, 30 June (Argus) — The Republican-controlled US Senate is set to vote as early as today on a bill that would gut clean energy tax credits from the Inflation Reduction Act, open vast amounts of land to drilling, dismantle fuel-economy standards and extend trillions of dollars in expiring tax cuts. The Senate over the weekend voted 51-49 to start debate on the bill following weeks of infighting among moderates and conservatives, setting up a final vote that could occur as soon as today. Ahead of the vote, Republicans overhauled the bill to make deep cuts to existing tax credits for wind and solar energy, in addition to imposing an excise tax on wind and solar projects that come online after 2027 unless developers can show their equipment does not come from "prohibited foreign entities" such as China. Renewable energy groups say the last-minute changes to the budget bill — which would make tax credits contingent on a project starting to begin service, rather than just starting construction, by 2027 — would be devastating for investors and cause hundreds of thousands of job losses. Wind and solar developers say they could not invest in new projects because of the uncertainty on whether they would qualify for tax credits or be subject to the excise tax. "The Senate language effectively takes both wind and solar electric supply off the table," American Council on Renewable Energy chief executive Ray Long said. President Donald Trump's administration had pushed to terminate the tax credits for wind and solar, which had been expanded under the Inflation Reduction Act climate legislation Congress passed in 2022 as a way to transition to clean electricity. US energy secretary Chris Wright, in an opinion piece on 27 June, contended that the tax credits were raising prices and that it was "time to stop subsidizing such insanity in perpetuity." The revised bill would give clean hydrogen developers until 1 January 2028 to start construction to qualify for a tax credit of up to $3/kg. In another change, US senator Mike Lee (R-Utah) dropped a proposal that could have sold off millions of acres of public land toward private developers and landowners. Trump has said the US House of Representatives "must be ready" to send the bill to his desk before the 4 July holiday, a timeline that would not allow the chamber to consider any changes to the measure. Trump has said Republicans should not take vacation until the bill passes, even as some far-right conservatives have balked at the policies in the bill and a price tag that is expected to add more than $3 trillion to the deficit over a decade, according to the US Congressional Budget Office. The bill is expected to cut more than $500bn in funding by gutting most of the climate and energy programs from the Inflation Reduction Act. It would eliminate most incentives to purchase electric vehicles by terminating a $7,500 tax credit within 90 days and repealing penalties for automakers that fail to achieve fuel-economy standards. Senate Republicans such as Lisa Murkowski (R-Alaska) and John Curtis (R-Utah) had pushed to walk back some of the proposed cuts to the clean energy tax credits, but the last-minute revisions restored the deep cuts sought by far-right conservatives in the House. Nuclear and geothermal power plants would fare slightly better under the bill, remaining eligible for the full value of an electricity tax credit through 2033, although it could have remained in place indefinitely under existing law. US biofuel producers are also set to benefit from the bill from a four-year extension, through 2031, of a clean fuel production credit worth up to $1.25/USG for transportation fuel and $1.75/USG for sustainable aviation fuel. Oil and gas producers would see major benefits under the bill's overhaul of energy policy on federal lands. The bill would mandate twice-a-year lease sales in the US Gulf of Mexico, require regular onshore oil and gas leasing, slash royalty rates on new oil and gas leases, and roll back leasing changes made under the Inflation Reduction Act. In another win for the industry, the bill would reinstate a deduction for "intangible" drilling costs that is worth an estimated $427mn over a decade. The Senate bill lacks many of the permitting changes the House had in their version of the bill, such as a fee-for-permit program found ineligible for avoiding a filibuster. Also stripped out of the bill is a repeal of tailpipe standards that would support electric vehicles. Republicans have started to consider separate permitting legislation but any deal would likely need Democratic votes. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Japan plans task force to address SAF price challenges
Japan plans task force to address SAF price challenges
Tokyo, 30 June (Argus) — Japan's trade and industry ministry (Meti) will put together a task force to discuss how to further promote the use of sustainable aviation fuel (SAF). This comes as high prices remain a concern, reflecting a gap between refiners' costs and airlines' price requirements. The price of domestically produced SAF, even with support to suppliers of the renewable jet fuel, is far from the level at which airlines can purchase without affecting their revenues and profits, a Meti official said. It has become a big challenge to close the gap between the current price of SAF and the acceptable price for airlines, he added. Meti held a meeting of its SAF deployment promotion committee on 25 June, at which its member industry groups and companies approved a plan to set up the task force under the committee. The team will discuss how to cover the difference in prices and aims to report possible measures in December, the Meti official said. The proposals will arrive as the country's refiners make final investment decisions on their SAF projects. Meti awarded a public tender to four Japanese refiners — Eneos, Cosmo Oil, Idemitsu and Taiyo Oil — in February to receive financial assistance on their domestic SAF projects . The refiners are expected to make decisions on investments in these projects this year or the next, the ministry added. The ministry now seeks to make clear the direction of the country's SAF initiatives to help refiners with their upcoming investment decisions. Construction costs are rising because of a personnel shortage, and it is hard to make investment decisions without a clearer idea about the strength of demand or a market design, the refining industry said in the meeting. Meanwhile, the airline sector said that deploying high-priced SAF will hurt revenues. It is structurally difficult to sustain business at the current price level, the sector added. "With a scheme design provided, it will be easier for us to make decisions," a SAF project member of a Japanese refiner told Argus . "Without a well-designed scheme, domestic SAF cannot be widely used. Price gap coverage might be the best option, or a mandatory use of SAF might also be effective," he said. But it does not seem likely that Meti will finalise the scheme design by December. "There's no need to fully decide everything by the end of this year," the Meti official said. A large amount of domestic SAF will come into the market around 2028 or 2029, so the committee will work on details on the scheme and finalise it by then, he added. Japan aims to replace 10pc of the jet fuel consumption by domestic airlines with SAF in 2030. The country's SAF requirements, including foreign airlines' demand, will be around 1.7mn kl in 2030. Supply will be around 1.9mn kl in 2030, calculations by Meti and the land transport ministry as of January 2024 show. By Kohei Yamamoto Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
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