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EPA boosts renewable fuel requirement

Agriculture.com Staff 04/11/2007 @ 8:00am

The Environmental Protection Agency has concluded a final rule that boosts the use of renewable fuels for gasoline, a move seen as bullish for the corn market.

Under the plan, refiners will be required to use at least 7.5 billion gallons of renewable fuel in gasoline by 2012, or about 3 billion more gallons of renewable fuels used in 2006, the EPA said Tuesday. The rule, authorized in a 2005 energy law, signed by President Bush, also requires that 4.02 percent of gasoline sold or dispensed to U.S. motorists in 2007 be renewable fuel, or about 4.7 billion gallons. That is more than 1 percent higher than required in 2006.

Energy Secretary Samuel Bodman said the plan offers the American people a hat trick- it protects the environment, strengthens our energy security, and supports America's farmers.

The fuel standard also calls upon America's innovative spirit by providing incentives to spur advances in cutting-edge technology, infrastructure and farming methods, Bodman said.

"For example, we're excited by the real possibility of one day producing renewable fuel from agricultural and industrial byproducts, such as switchgrass and woodchips," Bodman said.

Meanwhile, Noel Blue, a Chicago Board of Trade floor broker and analyst, said the EPA news will be traded.

"I think with firm crude prices and the EPA requirement increase Tuesday that soyoil could be the slightly firmer component of the soy complex today as beans and meal continue their slide. Corn and wheat, however, remain firm as adverse weather continues to threaten their livelihood," Blue said.

The Environmental Protection Agency has concluded a final rule that boosts the use of renewable fuels for gasoline, a move seen as bullish for the corn market.

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