US corn and soybean oil futures on the Chicago Board of Trade and RIN prices were trending lower Friday morning amid reports that the US Environmental Protection Agency would lower its biofuels blending requirements for 2014.
December corn futures were down 4.5 cents at $4.3375/bushel, while October soybean oil futures were down 71 points at 40.33 cents/lb. Corn-based ethanol (D6) RINs were first reported traded at $0.30/RIN early Friday and fell as low as $0.25/RIN before firming to most recently trade at $0.30/RIN. Ethanol RINs were assessed at $0.40/RIN on Thursday.
Market sources said concerns regarding a significantly lower biofuels blending mandate had the two main feedstocks for ethanol and biodiesel trading lower. Multiple reports surfaced Wednesday and Thursday suggesting the EPA would lower the blending requirement for 2014, putting less pressure on the agricultural markets, sources said.
The EPA sent its proposals to the Office of Information and Regulatory Affairs on August 30 and they were recently under regulatory review. Any forthcoming announcement is expected to be delayed by the partial shutdown of the US federal government.
Of the 876.01 million gallons of biomass-based diesel produced in the US through July, soybean oil totaled 52.95% of feedstocks used, the most recent Energy Information Administration data showed. Roughly 35% of corn harvested in the US is used for ethanol production, sources said.
