U.S. Biodiesel Production Expected to Triple in 2006
November 8, 2006
The National Biodiesel Board (NBB) announced on October 31st that the U.S. production of biodiesel could reach 250 million gallons in 2006, triple the amount produced in 2005. The NBB credits state and federal incentives, grants, and tax credits for the industry's rapid growth. The NBB notes a particularly high amount of activity in state legislatures, with more than 275 biodiesel-related bills introduced this year, 53 of which passed. According to Joe Jobe, Chief Executive Officer of NBB, "With this flurry of activity at the state level, production increases could be even more dramatic in 2007." See the NBB press release and its list of state legislation (PDF 41 KB). Download Adobe Reader.
Some signs of how dramatic the growth could be in 2007 are presented by recent announcements of new biodiesel production plants. Washington State will soon feature the nation's largest biodiesel facility, since Imperium Renewables broke ground last week on a facility that will produce 100 million gallons per year (mgpy). The Grays Harbor plant will begin producing biodiesel from soybean and canola oil in mid-2007. Meanwhile, Nova Biosource Fuels, Inc. is planning two 60-mgpy biodiesel facilities, one in Oklahoma and one in Illinois. In fact, as of mid-September the NBB had tallied 86 operating biodiesel plants with a total capacity of 580 mgpy. An additional 65 plants are under construction and 13 plants are being expanded, enough to add another 1,400 mgpy in production capacity. See the press releases from Imperium Renewables (PDF 123 KB) and Nova and the NBB production tally (PDF 18 KB).
Despite the rapid growth, biodiesel production is not yet having a noticeable impact on soybean production. With a record soybean crop this year, combined with record-high inventories of soybean oil, prices have actually dropped since July. See the U.S. Department of Agriculture's "Oil Crops Outlook" (PDF 116 KB).