Dare I Say, 'Feeling Fine in '09'?

By Jessica Sobolik | November 13, 2008
In this issue of Biodiesel Magazine, we look ahead to what 2009 may have in store for our industry. 2008 was a rough year, mainly due to high feedstock prices and low demand.

However, I feel confident that there is a future for biodiesel. Here's why:
›Oilseed prices: Staff Writer Susanne Retka Schill concludes in her feature titled "Sizing Up the Soybean Market" on page 42 that soy oil prices will likely go down in 2009. Farmers are growing more of the oilseed crop this year, and food manufacturers are moving on to oils lower in trans fats. In fact, one source told Retka Schill that total consumption of soy oil for food use has decreased nearly 1 billion pounds over the past three years in the United States.

›Legislation: As Senior Staff Writer Ron Kotrba details in his feature titled "Transition Period" on page 52, the federal renewable fuels standard requires 500 million gallons of biomass-based diesel fuel to be consumed in the United States in 2009. Biodiesel will likely be one of the main fuels used. A word of caution here: A member of the industry once told me, "You can regulate biodiesel usage all you want, but until feedstock prices go down, it's not going to increase production." Perhaps in 2009, both factors will align into a perfect situation for biodiesel.

Furthermore, the biodiesel tax credit has been extended one year to Dec. 31, 2009 (see Industry News on page 18). It now offers the $1-per-gallon credit to producers using nonvirgin feedstocks such as yellow grease. It closes the splash-and-dash loophole, and it reduces the credit to 50 cents per gallon for biomass coprocessed with a petroleum feedstock. All of these changes create huge opportunities for biodiesel.

›Quality control: ASTM International has published new standards for biodiesel (see Industry News on page 19). Steve Howell, chairman of the ASTM Biodiesel Taskforce and technical director of the National Biodiesel Board, said, "This is perhaps the biggest technical achievement of the biodiesel industry since its inception in the United States in the early 1990s." I think that sums it up pretty well.

›Lobbying power: Speaking of the NBB, Staff Writer Kris Bevill details the association's 2009 priorities in the feature titled "Politics, Prices and Public Support" on page 60, along with the priorities of others in the biodiesel industry. The NBB aims to focus its lobbying attention on the extension of the biodiesel tax credit beyond 2009, the trade dispute between the United States and European Union, feedstock costs and sustainable feedstocks. A carbon emissions program may also be in this industry's future.

As you can see, there are a lot of factors changing the biodiesel industry in a positive way. In fact, I admit I was somewhat surprised to see the results of a study conducted by SRI Consulting (see BIObyte on page 18) that concluded the United States would become the largest biodiesel market by 2012. Amazing! I guess the cheesy saying, "Feeling fine in '09" really does apply here.

Jessica Sobolik
Managing Editor
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