Prices for current-year ethanol Renewable Identification Numbers fell to their lowest level since 2015 on Tuesday after President Donald Trump and US senators from agriculture and oil refining states reached an agreement on possible reforms to the US biofuel mandate.
S&P Global Platts assessed D6 current-year ethanol RINs 4.5 cents lower at 30 cents/RIN, their lowest level since Platts assessed them at that level on September 15, 2015.
Trump met with Agriculture Secretary Sonny Perdue, Environmental Protection Agency head Scott Pruitt and four Republican senators -- Ted Cruz of Texas, Pat Toomey of Pennsylvania, and Joni Ernst and Chuck Grassley of Iowa -- to discuss reforms to the Renewable Fuel Standard.
"After several meetings and input from stakeholders on both sides, President Trump is pleased to announce that a final decision has been made that allows E15 to be sold year-round, while providing relief to refiners," White House spokeswoman Lindsay Walters said in a statement.
"This outcome will protect our hardworking farmers and refinery workers. The president is satisfied with the attention and care that all parties devoted to this issue," said Walters.
RINs initially dropped in reaction to tweets from Cruz and Grassley noting the possibility that they could be issued on exported ethanol, which would increase the number of RINs available. Ethanol RINs for 2018 traded as low as 25 cents/RIN Tuesday.
Prices rebounded as published reports indicated that an agreement had been reached to allow the sale of gasoline blended with 15% ethanol year-round and to reject the use of a RIN price cap.
Grassley also tweeted that he was not sold on the idea of issuing RINs for ethanol exports, adding that details were not clear.
RINs prices have been on the decline since February 22, the day before reports were published announcing the first of five meetings held in the White House between US biofuel and oil refining interests to discuss RFS reforms. D6 ethanol RINs for 2018 compliance have fallen by as much as 52% since before the first meeting, when Platts assessed D6 RINs at 62.50 cents/RIN.
The EPA uses RINs to track the fulfillment of its renewable fuel blending mandate by obligated parties.
RINs prices fall when blenders expect to need fewer of the credits to comply with the standards.
