EPA, we have a serious issue that also begs question on how RINs have not fallen further to curtail production considering the increasing production of Renewable Diesel(HVO) and co-processing (seldom discussed). We are probably now running nearly 1 Billion Gallon (+3 Mil MT based on HVO density ) excess EMTS gallons in first 5 months showing an increase of 400 Million gallons Vs last year. This is alarming the industry in the US as RVOs that already have been set through 2025 and are clearly much lower than capacity to produce. Furthermore, it must be said that LCFS prices have fallen 42% since last year and 76% from their high - now this is not only as a result of Renewable Diesel as it only accounts for 80% of the supply of LCFS credits. D4 Biomass RINs have fallen 64% in line with BOHO enabling all producers to clear very good margins with all current available incentives. This RVO issue is not going away and increasing pressure from producers, oilseed crushers and oil&gas will continue to press EPA to do something before the election but very much fear that any candidate wants to tackle this issue. After elections might be too late and force industry to roll excess to 2025/2026 in order to curtail capacity or RINs will finally do the work!.
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