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