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Tristan R. Brown

 
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  • Green Plains Renewable Energy's New Dividend And Its Sustainability [View article]
    #1. I have never attended business school.
    #2. If you read through my articles on SA you'll quickly see that my stock positions reflect my view of the corn ethanol industry rather than vice versa. This is well documented.
    #3. The majority of U.S. consumers refuse to use blends of ethanol in excess of E10. It's been two years since the EPA approved E15 for public consumption and I can still count the number of stations offering E15 on two hands. Stating that corn ethanol's growth opportunities in the U.S. are limited is a recognition of the facts, nothing more. Brazil represents a short-term opportunity at best. U.S. corn ethanol can compete with Brazilian cane ethanol on neither an energy nor a cost basis during even moderately successful harvests.

    Thanks for commenting.
    Aug 24 07:53 PM | Likes Like |Link to Comment
  • Green Plains Renewable Energy's New Dividend And Its Sustainability [View article]
    Thanks, I've submitted a correction; I was not aware of the ADM JV expansion.
    Aug 24 02:09 PM | Likes Like |Link to Comment
  • Renewable Energy Group Has 150%+ Upside On Higher Capacity And The Blend Wall [View article]
    I still have no idea what caused yesterday's drop, but both the CEO and CFO took advantage of it to buy additional shares:

    http://bit.ly/19GYkmx
    Aug 20 01:19 PM | 2 Likes Like |Link to Comment
  • Fuel Blenders Win From The Biofuels Mandate [View article]
    That's why I only took the data back to the beginning of 2012, as otherwise the multitude of exogenous factors would make the analysis far too complex to be of any use for our purposes.

    Nice series on the RFS2, by the way.
    Aug 20 11:34 AM | 1 Like Like |Link to Comment
  • Fuel Blenders Win From The Biofuels Mandate [View article]
    If it's any consolation, I've studied the RFS2 full-time for two years now and I'm still learning about how it operates. The simplest answer would be to create a carbon tax with offsetting reductions to income taxes. I suspect that this would be too efficient for D.C. politicians (simple tax systems limit their ability to dole out favors, after all), but it would allow for the markets to identify the long-term solution.
    Aug 20 11:32 AM | 1 Like Like |Link to Comment
  • Renewable Energy Group Has 150%+ Upside On Higher Capacity And The Blend Wall [View article]
    I'm not sure that the move in feedstock costs is the explanation, as other 1st-gen biofuel producers fared much better yesterday. Interestingly enough, one website states that the fall was "possibly linked to a bearish Seeking Alpha article this morning."

    http://bit.ly/19GKgtj

    The only SA article on SA published yesterday was Part II of your series on the RFS2. I'm not sure I would categorize it as being "bearish" on REG, either.
    Aug 20 11:29 AM | Likes Like |Link to Comment
  • Renewable Energy Group Has 150%+ Upside On Higher Capacity And The Blend Wall [View article]
    I haven't seen anything in the news and there are no new filings.
    Aug 19 11:50 AM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    Thanks for referring me to the WSJ article; I've been hearing about the recent exemption and look forward to learning more about it.
    Aug 15 09:09 PM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    Thanks for the clarification. I would disagree that feedstock producers have been the primary beneficiaries from higher RIN prices, however, simply because feedstock costs have fallen significantly in 2013 even as RIN prices have skyrocketed. Furthermore, higher feedstock costs would be reflected in higher ethanol costs relative to gasoline, and that isn't something that we've seen either, at least not on an historical basis.

    Other parties are benefiting from high RIN prices, although I'm still trying to establish which companies are in that group (if any).
    Aug 15 03:20 PM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    From the "Conclusion" section:

    "Instead, it provides some evidence for the theory that non-obligated blenders are increasing ethanol blends and incentivizing extra consumption by using higher RIN values to discount ethanol relative to gasoline. While the data is not conclusive, this suggests that the recent "RINsanity" could actually be due to the RFS2 operating as designed..."

    At no point do I state, either by inference or otherwise, that the refining industry as a whole has benefited from the RFS2 (although I did write a previous article on BP's conference call, which attributed some of its quarterly profits to RIN sales, as well as a second article on the effect of RINs on PBF's rather poor quarterly performance). Indeed, I explicitly point out that parties other than refiners can benefit from RINs by blending fuels. This should not be construed, as you seem to have done, as meaning that refiners have broadly benefited from the RFS2. Those refiners that anticipated January's surge in RIN prices by blending in excess of their RVOs have (see BP); those that did not do so have not (see PBF). Non-refiners that have blended fuels have also benefited.

    I can appreciate that you are opposed to the RFS2 and I certainly don't judge such a position, but your stance appears to be warping your interpretation of this article. Again, this article questions the theories that (1) the broader biofuel industry is directly benefiting from expensive RINs in the form of higher biofuel prices, and (2) that this is evidence that the RFS2 is "broken." Now, if you wish to allege that the costs of the RFS2 outweigh its benefits then I am more than willing to consider that specific position. But stating that my conclusion is "political" simply because you oppose its subject is erroneous. It is possible to state that the program is functioning as designed without staking a political stance on it.
    Aug 14 10:29 PM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    Actually, the article argued that the blenders are capturing most of the RIN value, not the feedstock producers.
    Aug 14 06:17 PM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    My conclusion is simply that the RFS2 continues to operate in the manner that will result in higher volumes of blended fuel being produced and consumed in the U.S. While the specific mechanism by which this occurs was not necessarily envisioned back in 2007, it is hardly political to state that the program is still functioning in a manner that furthers the original blending goals.
    Aug 14 06:16 PM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    Yes, but the degree of the benefit depends on the individual refiner's blending capacity. Those with the smallest volumes have benefited the most from the 50% fall in D6 RIN prices since mid-July.
    Aug 14 06:14 PM | Likes Like |Link to Comment
  • Have Biofuel Producers Actually Benefited From Expensive RINs? [View article]
    Thanks for the comment, Robert. I don't want to draw a perfect correlation between blenders and refiners; while many refiners do their own blending, many biofuel producers (e.g., REG) and other non-refiners do some as well. More study is needed, but I'm beginning to think that the best means of identifying winners under the RFS2 is by identifying those non-obligated blending companies with the most blending capacity.

    While such a result wasn't necessarily envisioned by the RFS2's authors, it isn't necessarily counter-intuitive. After all, it is still operating to maximize the volume of biofuels consumption in the U.S.
    Aug 14 06:12 PM | Likes Like |Link to Comment
  • Since RFS Went Into Effect, Corn, Not Oil, Drives Up Food Prices [View article]
    Needless to say both "findings" are spurious. Of course, Fuels America didn't publish its results here on SA.
    Aug 13 01:23 PM | Likes Like |Link to Comment
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