Ethanol Producer Magazine
December 15, 2015
BY Erin Krueger
The Federal Trade Commission has issued its 2015 Report on Ethanol Market Concentration. As in prior years, the report concludes that it is “extremely unlikely that a single ethanol producer or marketer or group of such firms could exercise market power to set prices or coordinate on price or output levels.”
The annual report is required by the Energy Policy Act of 2005 in order to “determine whether there is sufficient competition among industry participants to avoid price-setting and other anticompetitive behavior.”
Advertisement
Advertisement
According to the report, the number of firms producing ethanol decreased slightly since last year’s analysis. As of September, the report indicates the U.S. has 146 firms that can produce or are likely to begin producing ethanol within the next 12 to 18 months. In September 2014, the FTC’s report showed 148 firms could produce or were likely to begin producing ethanol over the following 12 to 18 months.
The report notes the largest ethanol producer’s share of domestic capacity is currently at 11 percent, which is unchanged from its 2014 percent share.
Advertisement
Advertisement
According to the FTC, the U.S. ethanol industry is unconcentrated today, suggesting any unilateral or coordinated attempt to exercise market power is highly unlikely. In fact, the industry is less concentrated today than it was in 2005, when the FTC published its first report on ethanol market concentration. In the event the industry becomes more concentrated, the report notes the possibility of new firms entering the domestic market and the responsiveness of ethanol imports to relative changes in domestic ethanol prices would likely provide additional constraints on anticompetitive behavior by domestic firms.
A full copy of the report can be downloaded from the FTC website.
CoBank’s latest quarterly research report, released July 10, highlights current uncertainty around the implementation of three biofuel policies, RFS RVOs, small refinery exemptions (SREs) and the 45Z clean fuels production tax credit.
The U.S. Energy Information Administration maintained its forecast for 2025 and 2026 biodiesel, renewable diesel and sustainable aviation fuel (SAF) production in its latest Short-Term Energy Outlook, released July 8.
XCF Global Inc. on July 10 shared its strategic plan to invest close to $1 billion in developing a network of SAF production facilities, expanding its U.S. footprint, and advancing its international growth strategy.
U.S. fuel ethanol capacity fell slightly in April, while biodiesel and renewable diesel capacity held steady, according to data released by the U.S. EIA on June 30. Feedstock consumption was down when compared to the previous month.
XCF Global Inc. on July 8 provided a production update on its flagship New Rise Reno facility, underscoring that the plant has successfully produced SAF, renewable diesel, and renewable naphtha during its initial ramp-up.