The Obama administration will grant a request from ethanol producers to permit higher concentrations of the corn-based fuel additive in gasoline for vehicles made in 2007 and later, a person familiar with the decision said. Ethanol makers rose in New York trading.
The Environmental Protection Agency will announce later today its decision allowing refiners to blend as much as 15 percent ethanol into fuel, up from the current 10 percent, said the person, who spoke on condition of anonymity before the announcement.
Archer Daniels Midland Co. is among producers that have pressed the EPA to raise the limit for an industry in which at least a dozen companies have sought bankruptcy protection since 2008. Opponents, including oil companies and automakers and environmental groups, say adding more ethanol may damage car engines, boost food prices and worsen air quality.
Archer Daniels of Decatur, Illinois, rose 45 cents, or 1.4 percent, to $33.16 at 9:53 a.m. in New York Stock Exchange composite trading. The company is the second-largest U.S. ethanol producer behind closely held Poet LLC, based in Sioux Falls, South Dakota.
“The approval of E-15 by the EPA won’t have a positive effect on ADM in the near-term,” Robert Moskow, an analyst for Credit Suisse AG in New York who has an “outperform” rating on the shares, said in a report Oct. 6. “Blenders remain reluctant to implement E-15 because it requires a separate pump and because the EPA has not absolved the blenders of potential legal liability from consumers.”
Green Plains, Aventine
Green Plains Renewable Energy Inc., based in Omaha, Nebraska, rose 26 cents, or 2.3 percent, to $11.55 on the Nasdaq Stock Market. Aventine Renewable Energy Holdings Inc. rose 50 cents, or 1.9 percent, to $27.50 in the over-the-counter market.
The EPA delayed its decision in December, saying it needed more time to conduct tests on the blend. A decision was again postponed in June, prompting Growth Energy, the ethanol-industry trade group seeking the 15 percent blend, to write to President Barack Obama expressing frustration with the process.
The plan to allow increased ethanol levels was reported late yesterday by the Wall Street Journal.
Raising the “blend ratio” will increase demand. By law, the U.S. must use 12 billion gallons of renewable fuels such as ethanol next year, up from 10.5 billion in 2009, and use 15 billion gallons by 2015.
GM, Ford, Chrysler
General Motors Co., Ford Motor Co. and Chrysler LLC have said the government should be cautious about increasing the ethanol percentage in gasoline. AAA, the nation’s biggest motoring organization, said in July 2009 the EPA should reject the Growth Energy request because higher blends may damage exhaust systems, engines and fuel pumps and destroy catalytic converters.
Valero Energy Corp., the largest U.S. refiner, and Marathon Oil Co., the largest refiner in the Midwest, are concerned selling gasoline with more of the corn-based fuel additive may leave them liable for engine damage, according to company spokesmen.
http://jodnet.blogspot.com
The Environmental Protection Agency will announce later today its decision allowing refiners to blend as much as 15 percent ethanol into fuel, up from the current 10 percent, said the person, who spoke on condition of anonymity before the announcement.
Archer Daniels Midland Co. is among producers that have pressed the EPA to raise the limit for an industry in which at least a dozen companies have sought bankruptcy protection since 2008. Opponents, including oil companies and automakers and environmental groups, say adding more ethanol may damage car engines, boost food prices and worsen air quality.
Archer Daniels of Decatur, Illinois, rose 45 cents, or 1.4 percent, to $33.16 at 9:53 a.m. in New York Stock Exchange composite trading. The company is the second-largest U.S. ethanol producer behind closely held Poet LLC, based in Sioux Falls, South Dakota.
“The approval of E-15 by the EPA won’t have a positive effect on ADM in the near-term,” Robert Moskow, an analyst for Credit Suisse AG in New York who has an “outperform” rating on the shares, said in a report Oct. 6. “Blenders remain reluctant to implement E-15 because it requires a separate pump and because the EPA has not absolved the blenders of potential legal liability from consumers.”
Green Plains, Aventine
Green Plains Renewable Energy Inc., based in Omaha, Nebraska, rose 26 cents, or 2.3 percent, to $11.55 on the Nasdaq Stock Market. Aventine Renewable Energy Holdings Inc. rose 50 cents, or 1.9 percent, to $27.50 in the over-the-counter market.
The EPA delayed its decision in December, saying it needed more time to conduct tests on the blend. A decision was again postponed in June, prompting Growth Energy, the ethanol-industry trade group seeking the 15 percent blend, to write to President Barack Obama expressing frustration with the process.
The plan to allow increased ethanol levels was reported late yesterday by the Wall Street Journal.
Raising the “blend ratio” will increase demand. By law, the U.S. must use 12 billion gallons of renewable fuels such as ethanol next year, up from 10.5 billion in 2009, and use 15 billion gallons by 2015.
GM, Ford, Chrysler
General Motors Co., Ford Motor Co. and Chrysler LLC have said the government should be cautious about increasing the ethanol percentage in gasoline. AAA, the nation’s biggest motoring organization, said in July 2009 the EPA should reject the Growth Energy request because higher blends may damage exhaust systems, engines and fuel pumps and destroy catalytic converters.
Valero Energy Corp., the largest U.S. refiner, and Marathon Oil Co., the largest refiner in the Midwest, are concerned selling gasoline with more of the corn-based fuel additive may leave them liable for engine damage, according to company spokesmen.
http://jodnet.blogspot.com
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