Ethanol Blog
Myke Feinman Refine Fuels Reporter

Thursday 05/16/13

D4/D6 RIN Differential Steady; Spread Trade Talked

The spread between ethanol D6 and biodiesel D4 Renewable Identification Numbers is starting to be quoted as one unit, an analyst said, with the spread maintaining between a 10 and 13 cents discount for D6 RINs. A D4 RIN is equivalent to 1.5 D6 RINs.

"Ethanol RINs are generally accepted to be a floor on biodiesel RIN prices for the same vintage," Michael Walker, quantitative analyst for Augsburg Energy, Ramsey, New Jersey, said this morning. "We even see the D6/D4 spread quoted as one unit and it was sitting around 13 cents yesterday."

He added given the different market sizes in biodiesel and ethanol RINs, a movement in ethanol prices would have "much more impact on that spread and the other product than a movement in biodiesel prices."

Trade sources agree that ethanol RINs affect biodiesel RINs and see the spread between them maintaining at the same level.

"It seems to maintain a spread of 10 cents," one trade source said Wednesday.

Myke Feinman can be reached at myke.feinman@telventdtn.com.

Posted at 11:35AM CDT 05/16/13 by Myke Feinman
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