EPA Moves to Restore 770 Million Biofuel RINs Lost to 2025 Refinery Exemptions, Timing Still Open
EPA wants to put back the biofuel demand it gave away through extra 2025 small refinery exemptions, roughly 770 million RINs by Clean Fuels Alliance America's count, and it still hasn't said when that volume lands. Kurt Kovarik, the group's vice president of federal affairs, told the Agribusiness Report that EPA is proposing to reallocate 100% of the gap between the exemptions it first estimated and the ones it ultimately granted. That full-restoration piece is the part that protects your blending obligations.
The open question is the calendar. EPA is weighing two paths. One splits the supplemental volume between 2026 and 2027. The other drops the entire amount into 2027.
That choice matters to anyone holding or short RINs. Load the whole 770 million into 2027 and you push a heavier obligation into a single year, which could firm RIN values later and leave 2026 softer. Split it and the demand signal spreads out. Either way the volume is preserved, so the reallocation itself is good news for biodiesel and renewable diesel demand. The timing is what the trade will argue over.
The ethanol numbers
US fuel ethanol production rose 1% in the week ended October 9, to 1.065 million barrels a day, up 12,000 bpd from the prior week, per EIA. Output is still running 9,000 bpd below the same week last year, so this is a modest uptick off a lower base.
Stocks climbed to 23.942 million barrels, a gain of 199,000 barrels. Exports fell 27% on the week. Building inventory with weaker export pull tends to pressure spot ethanol, and that softer tone could carry into blend economics if the trend holds another week or two.
A biodiesel margin read
Verbio shares jumped 10% after Jefferies flagged improving biodiesel margins as a lift to earnings. Verbio is a German producer, so don't trade your RIN position off a Frankfurt stock move. The useful signal for a US jobber is that a sell-side desk sees biodiesel crush spreads firming, which lines up with the demand support the EPA reallocation would lock in on this side of the Atlantic.
The rest of the overnight biofuels wire was lab and campus material. A University of Benin waste-to-biodiesel project and an engineered bacterium that converts ethanol into cinnamic acid. Interesting science, nothing that touches a US rack this quarter.
What to watch
Watch which timing option EPA settles on, 2026-2027 split or all-in-2027, because that sets where the RIN demand weight falls. Watch whether ethanol exports keep sliding as stocks build, which could soften spot values. And watch biodiesel spreads to see if the margin firming Jefferies cited shows up at US plants.