Texas biodiesel prices dip on demand uncertainty

03 November 2006 21:57  [Source: ICIS news]

HOUSTON (ICIS news)--Texas biodiesel prices dipped this week due to uncertain demand caused in part by a state requirement that would block biodiesel sales in nearly half of its counties, market sources said on Friday.

The global chemical market intelligence service ICIS pricing assessment for B100 in the Texas market fell about 15 cents/gallon as a policy decision by the Texas Commission on Environmental Quality (TCEQ) appeared to put a damper on producers’ expectations of demand requirements, market sources said. 

The policy decision by the TCEQ would disallow the use of biodiesel in 110 of the state’s 254 counties, limiting selling opportunities for a growing number of Texas producers.

Biodiesel producers were contesting the TCEQ action, which would be effective on 31 December. The state agency was seeking to block the use of biodiesel in an effort to reduce nitrogen dioxide emissions in those counties.

According to the National Biodiesel Board (NBB), there were 86 operating biodiesel plants in the US, with total production capacity of about 580m gallons/year. Of these 86 locations, 14 were in Texas and represented about 100m gallons/year of production capacity.

Major Texas plants in the Houston area included Johann Haltermann, with 20,000,000 gallons/year capacity using soybean oil feedstock; Huish Detergents of Pasadena, with 4,000,000 gallons annual capacity using palm oil; and Organic Fuels of Galena Park, with 30,000,000 gallons/year capacity using soybean oil.

By: Judith Taylor
+1 713 525 2653

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