Report: Canadian ethanol consumption continues to grow
SOURCE: USDA FAS GAIN
August 24, 2023
Canadian fuel ethanol consumption increased approximately 20 percent last year while Canadian imports of fuel ethanol produced in the U.S. were up an estimated 40 percent, according to a report filed with the USDA Foreign Agricultural Service’s Global Agricultural Information Network in August.
Canada’s Clean Fuel Regulation became law in July 2022. It aims to reduce the carbon intensity (CI) of liquid transportation fuels and is expected to boost the consumption of ethanol, biobased diesel and other renewable fuels. The report cites an estimate by Environment and Climate Change Canada that indicates the CFR could boost the consumption of low-CI diesel by 2.2 billion liters (581.18 million gallons) and the consumption of ethanol by 700 million liters by 2030. In addition to the federal CFR, biofuel consumption in Canada is supported by various provincial regulations.
Fuel ethanol consumption in Canada reached 3.4 billion liters in 2022, up 20 percent when compared to the previous year. Consumption is expected to increase to 3.88 billion liters this year due to strong imports from the U.S. and continued recovery in post-pandemic transportation, according to the report.
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There are currently 12 operational ethanol plants in Canada, a number that has held steady since 2018. Those plants have a combined nameplate capacity of 1.88 billion liters, which has remained steady since 2019. Canada’s ethanol plants are expected to operate at 88 percent capacity this year, down from 94 percent in 2022 and 91 percent in 2021.
Total ethanol production in Canada is expected to reach 2 billion liters in 2023, including 1.66 billion liters of fuel ethanol. Total ethanol production was at 2.1 billion liters in both 2021 and 2022, including a respective 1.72 billion liters and 1.77 billion liters of fuel ethanol.
Total ethanol consumption is expected to reach 4.1 billion liters this year, up from 3.83 billion liters in 2022 and 3.31 billion liters in 2021. Fuel ethanol consumption was at 2.87 billion liters in 2021 and 3.45 billion liters in 2022 and is expected to increase to 3.85 billion liters in 2023.
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Canadian exports of ethanol are relatively low, forecast at 140 million liters this year, including 80 million liters of fuel ethanol. Canada exported 178 million liters of ethanol, including 108 million liters of fuel ethanol, in 2021 and 153 million liters of ethanol, including 82 million liters of fuel ethanol, in 2022.
Canada imported 1.39 billion liters of ethanol in 2021, including 1.25 billion liters of fuel ethanol. Imports increased to 1.9 billion liters of ethanol in 2022, including 1.76 billion liters of fuel ethanol. This year, Canada is expected to import 2.28 billion liters of fuel ethanol.
The ethanol blend rate in Canada is expected to reach 8.3 percent this year, up from 7.6 percent in 2022 and 6.4 percent in 2021.
A full copy of the report is available on the USDA FAS GAIN website.
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