GRAPEVINE, Texas Feb. 19, 2015 - At home and abroad, the U.S. ethanol industry faces tough challenges such as:
--U.S. EPA still hasn’t announced the Renewable Fuel Standard volumes for 2014, due November 2013, or the 2015 volumes, due last November.
--The major U.S. oil companies continue to resist installing the blender pumps needed to give consumers the choice of higher ethanol blends.
--Europe continues to block U.S. ethanol imports with anti-dumping measures.
--And the U.S. government hasn’t stepped in to challenge Europe’s ethanol trade barrier.
But in an Agri-Pulse interview just before launching the 20th annual Renewable Fuels Association (RFA) National Ethanol Conference here in Texas, RFA President and CEO Bob Dinneen insisted that the industry is fighting back aggressively – and successfully.
One RFA response provided the theme for this year’s conference: “Going Global.” Dinneen tells us that “If our government is going to put artificial constraints on how much ethanol we can sell domestically, we have got to be looking abroad and there are growing market opportunities in all corners of the globe.”
Dinneen says that RFA, working closely with the U.S. Grains Council and Growth Energy, helped the industry export 836 million gallons last year and he expects even more exports for 2015. After sending trade missions last year to growing markets including Brazil, China, Japan, Panama, Philippines and Peru, he says more missions are planned for 2015 “because we believe the markets are there and we believe we can generate a great deal more in export opportunities for our producers.”
“We sold into 51 countries on all six inhabited continents of the globe,” Dinneen says, “so this is indeed a global industry. Because U.S.-produced ethanol is the lowest cost octane source in the world, there are going to be markets available to us and we are certainly focusing on making sure that we are growing those opportunities.”
Dinneen charges that Europe’s “illegal anti-dumping duty, despite no evidence of dumping” has “robbed us of a 300 million gallon market.” The industry has taken Europe to court but he says there’s no telling how long that legal battle will last. So he’s frustrated that after two years “our own U.S. government is not standing up and challenging that illegal anti-dumping duty.” He calls on the U.S. Trade Representative (USTR) to challenge the Europeans and reopen that market to U.S. ethanol.
Despite frustration over U.S. government failures to protect ethanol from challenges at home and abroad, Dinneen sees a lot to celebrate, including thriving ethanol exports to the four largest markets for U.S. ethanol – Canada, Brazil, the United Arab Emirates and the Philippines. After his 28 years in the ethanol industry, Dinneen says that he’s excited about the industry’s future.
“We are coming off the single most profitable year in the industry’s history, and while 2015 is not likely to be a repeat of that, this is an industry that is now steeled for the good times and the bad times.” He says that although “2015 might be a bit more challenging,” he’s confident that the industry’s healthy growth will continue. “This year we are going to produce close to 15 billion gallons, if not more than 15 billion gallons, with production not just from grain but from cellulose.”
As for the conference topics for the next two days, Dinneen says “We’ll certainly talk about the Renewable Fuel Standard. We’re going to be talking about E15 and market opportunities there. We’re going to be talking about what things EPA can be doing to increase market opportunities beyond the RFS. If they would provide parity with respect to volatility regulations, that would go a long way toward opening up market opportunities for E15. We’re going to be talking about some rail issues. We’ll certainly be talking about the political climate in Washington, DC.”
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