Soyatech's Biofuels Index, which tracks planned and actual build-out of biofuels production capacity, reports dramatic growth in planned capacity for ethanol plants over the past year, from 6.761 billion gallons per year (BGY) as of July 1, 2006, to 13.03 BGY as of July 1, 2007 - an increase of 93%.
..."While the percent change is too small and the time frame too short to identify this as a definitive trend, we understand from industry sources that it is more difficult to secure debt financing for new refineries due largely to increased equity requirements on the part of banks providing this funding.
...The Index summary also discusses issues surrounding feedstock availability, noting a movement away from reliance only on soybean oil and towards the use of alternative feedstocks in the capacity build-out of biodiesel plants.
..."Given the development of trends that we have observed over the last six months, we expect convergence in the price of all commodity fats and oils over the next 6 to 12 months that will leave little to no additional margin for biodiesel producers that use alternative sources," Golbitz noted.
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