The global ethanol industry has been in recovery mode for a while now after the devastating effects of the historically high commodity prices from 2010 well into 2013. The economic effects of low margins are going away rather quickly, while policy reforms that came, among others, on the back of the high price phase on the world grains and sugar markets will have a longer-term impact on the global ethanol (and biofuels) industry.<\/p>\n
The recent months have brought a couple of new policy developments which are also reflected in our statistics on ethanol and biofuels investment. These include a proposed cut on Renewable Fuel Standard (RFS) for 2014 and fuel price issues in Brazil.<\/p>\n
The RFS used to be a key argument to invest, especially for such a risky product like cellulosic ethanol; the proposed cut for 2014 raises the level of uncertainty as it may pave the way for cuts in the years from 2015.<\/p>\n
Unlike the United States, Brazil expects a rising fuel demand, and the question is how this will be met. Investment in ethanol can only happen if there is a clear signal from the federal government regarding the future of the segment. Currently, the investment incentive mainly is a function of fuel pricing as other outlets for ethanol in the country are still in the development phase. As fuel prices are fixed by the government, one may understand why the development of the Brazilian ethanol sector does not correspond to upbeat projections by the Energy Ministry on future fuel needs.<\/p>\n
Not all investment in the ethanol and biofuels sector in recent years can be properly accounted for. Indeed, listed biofuel companies have to publish their investment plans. However, information on how much of total capital expenditures actually was investment is difficult to obtain. Additionally, there is a significant time-lag between the date when a project has been decided upon and the moment when the first money flows.<\/p>\n","protected":false},"excerpt":{"rendered":"
The global ethanol industry has been in recovery mode for a while now after the devastating effects of the historically high commodity prices from 2010 well into 2013. The economic effects of low margins are going away rather quickly, while policy reforms that came, among others, on the back of the high price phase on […]<\/p>\n","protected":false},"author":59,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"","nova_meta_subtitle":"","footnotes":""},"categories":[5572],"tags":[],"supplier":[],"class_list":["post-19828","post","type-post","status-publish","format-standard","hentry","category-bio-based"],"_links":{"self":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/19828","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/comments?post=19828"}],"version-history":[{"count":0,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/19828\/revisions"}],"wp:attachment":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/media?parent=19828"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/categories?post=19828"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/tags?post=19828"},{"taxonomy":"supplier","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/supplier?post=19828"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}