US ethanol credits prices fall after EPA delays biofuel deadline
Market sources reported that 'prices' for U.S. Ethanol Blending Credits plunged to their lowest level in over four months on Monday, after the Environmental Protection Agency announced it would extend the September 1 deadline for refiners, and make a decision on the long-pending requests for small refinery exemptions by the end August.
At 12:45 pm, conventional ethanol Renewable Identification numbers (D6RINs) were trading at $1.75 per unit. Argus Media reports that the price of D6 RINs, which are used to identify renewable ethanol credits, was $1.75 at 12:45 p.m. ET. This is down 34 cents since Friday and its lowest level since April 15. Credits traded at $2.50 as recently as July 7. Argus data shows that the last assessment of biomass-based diesel RINs (2026) was around $1.92 per unit,?the lowest level since April.
The Renewable Fuel Standard is a federal program that aims to increase the use of renewable fuels. Refiners must show by September 1 they have met their 2025 biofuel blend mandates. They can do this by blending biofuels into the nation's gasoline supply, or by buying credits from other market players.
Jessica Dell, Argus Media's head of U.S. Biofuel Pricing, stated that RIN prices dropped again in value during the Monday session due to the EPA's upcoming small refinery exemption decisions. RIN prices fell 5% Friday. Some of the petitions date back to July 20,24. The timing of those decisions was a major uncertainty for the market. This is especially true after the EPA finalized the record-high requirements for renewable fuel blends for 2026-2027, which have "added" to the compliance burdens for these companies, Dell stated.
Scott Irwin is an agricultural economist from the University of Illinois. He said that extending the compliance deadline would also signal "RIN relief" to refiners for their obligations in 2026 and 2027.
The EPA's rulings are expected to?free-up a significant amount of credits. The refining industry and an analyst believe that exemptions will allow small refineries to meet their compliance obligations for 2025 by using between 1.2 billion - 1.8 billion RINs. EPA had previously indicated that it could reallocate 990 millions RINs 'associated with exemptions.
A senior trader stated that RINs fell as the market began to speculate about SRE relief of around 1.8 billion. This was a shock compared to the 1.3 billion expected by the market. (Reporting and editing by Deepa Babyington, Siddharth Cavale, Shariq Khan from New York)
(source: Reuters)
