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Largest regional retail transportation fuel market in the world.

  • Ethanol Consumption: Approx. 1.7 billion gallons/yr
  • 10% Blend in most CA gasoline

Trade:

  • 10-15 million gallons imported to CA every MONTH
  • Ethanol price per gallon: ~$2.43 (Jun.2013)

Low Carbon Fuel Standards (LCFS)

  • Requires 650 million gallons of sugarcane ethanol by 2016
  • Creates ethanol demand of more than 1 billion gallons by 2020

Ethanol Market in Los Angeles

US Ethanol

Ethanol

CALIFORNIA

MARKET

Policy

U.S. Advanced Biofuel Mandate (EPA & LCFS)

Energy Policy Act of 2005 (EPA)

Renewable Fuel Standard (RFS2)

2007 Energy Independence and Security Act

Conventional ethanol:

  • From 12.6 billion (2011) gallons
  • To 15 billion (2015) gallons

Advanced Biofuels:

  • From 1.4 billion (2011) gallons
  • To 21 billion (2022) gallons

Taxes and Tariffs Expired (2011):

  • $0.45/gallon - Volumetric Ethanol Excise Tax Credit
  • $0.54/gallon - Imported Fuel Ethanol Tariff

Projections (2016):

  • Production: 314 billion gallons
  • Total trade between BR and US: over 4 billion gallons

Trends (E10, E15, E85)

OPPORTUNITIES

TRADE US-BRAZIL (2012)

US Export: 130 million gallons of corn ethanol

US Import: 400 million gallons of Brazilian ethanol

Projected Market Size (CA):

  • 2016: 650 million gallons, $1.7 billion
  • 2020: 1 billion gallons, $2.5 billion

Emerging/Expanding Market Applications:

  • Implementation of E15 (15% ethanol, 85% gasoline)
  • E85 (85% ethanol, 15% gasoline) for use in flexible fuel vehicles (FFVs)
  • Current California FFV: ~400,000 (about 1.5% of on-road vehicles)
  • Over 6 million FFVs in America and growing
  • Excess advanced biofuel credit:
  • Not enough cellulosic biofuel to meet RFS2 target
  • Cellulosic (2nd Generation) Ethanol Advancements in Brazil
  • Technological expertise and experience transfer
  • Brazilian mills: sale or creation of a JV with a company with a larger balance sheet

Brazil

Sugarcane Sector:

  • Mills: 430
  • Growers: 70,000+
  • Market: US $68b
  • Export: US $16.2b

#1 Sugar Producer (25%)

#2 Ethanol Producer (36.4%)

Ethanol 2012-13:

  • Production: 35.7 billion liters
  • Internal demand: 80%
  • 60% of light vehicle fleet is "Flex"
  • 85% of new vehicles are "Flex"
  • 25% Ethanol blend mandate (2013)

Exports to US in 2012:

  • 2.05 billion liters
  • US $1.5 billion

  • Superior liquid bulk infrastructure
  • Multiple third party logistics providers
  • Proprietary refinery terminals (support 3 of the region’s refineries)
  • Strategic location (6 major regional refineries)
  • within 2 miles of four refineries
  • within 15 miles of the remaining two refineries
  • Marine terminals: efficient pipeline connections to all major local refineries and third party storage facilities
  • Ethanol Storage Capacity

THE PORT OF LOS ANGELES

Thank You!

Stephen Cheung

Director of International Development - Port of Los Angeles

Director of International Trade - City of Los Angeles

scheung@portla.org

Felipe Cusnir

International Development - Port of Los Angeles

fcusnir@portla.org

EPA Definition:

Corn Ethanol Renewable Biofuel

Sugarcane Ethanol Advanced Renewable Biofuel

90% world production, consumption and trade:

U.S., Brazil, EU, Canada, China and Indonesia

90% of World Ethanol production:

US (corn, ~50%)

Brazil (sugarcane, ~40%)

Top Producers of Sugarcane:

Brazil (31%), India (19%), China (7%), Thailand (5%)

San Pedro Bay Ports:

  • 48% of import/export on US West Coast
  • Marine logistics
  • Regional refineries handle more than half of transportation fuel in the state:
  • Chevron, ExxonMobil, Phillips 66, Valero, British Petroleum and Tesoro

Infrastructure & Logistics

Government Agencies

Refineries/ Buyers

Shipping Lines

Storage

Facilities

Suppliers & Traders

Facts about Ethanol in the US (2012)

  • Number of Mills: 193
  • Production: 13.9 billion gallons
  • Consumption: 12.9 billion gallons
  • Gross Import: 490 million gallons
  • Gross Export: 715 million gallons

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