Biodiesel demand Estimates Now Provided in Petroleum Supply and Demand Balances

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Biodiesel production data were reported for the first time in U.S. and regional petroleum supply and disposition balances as published by the U.S. Energy Information Administration (EIA) in the Petroleum Supply Monthly (PSM) in May 2012. The biodiesel production data in the PSM will allow EIA to more completely account for biodiesel when calculating demand (measured as product supplied) for distillate fuel oil. Biodiesel production and other biodiesel data are now included in the item "Renewable Fuels Except Fuel Ethanol" in PSM supply and disposition tables.

In addition, previously published PSM data for January-April 2012 were revised to include biodiesel production. Similar revisions will be reported for 2011 when the Petroleum Supply Annual is released at the end of August 2012.



Product supplied is a widely followed measure of demand for petroleum products. For finished petroleum products (including distillate fuel oil), product supplied is calculated as the sum of production, imports, net receipts (only for regional data), and adjustments minus the sum of stock change, refinery and blender input, and exports. While not a measure of actual consumption, product supplied has proven to be a useful approximation of demand for petroleum products.

In the case of biodiesel, EIA assumes that any biodiesel that is produced is blended with diesel fuel, adding to the diesel fuel pool. This biodiesel production amount adds to the distillate fuel product supplied level, as shown on the graph. Including biodiesel production in the distillate fuel production volume added between 50 to 70 thousand barrels per day over the first five months of 2012.

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EIA Publishes Monthly Biodiesel Production Data for 2010 and 2011

U.S. production of biodiesel was a record 109 million gallons in December 2011, according to new data released by the U.S. Energy Information Administration (EIA). Production came from 113 active biodiesel plants. Biodiesel production for all of 2011 was 967 million gallons, which was the highest level recorded since EIA began tracking this data. Biodiesel fuel is mainly used for transportation, similar to diesel fuel.



Monthly biodiesel production had both sharp increases and decreases in 2009 and 2010 due in part to the expiration and reinstatement of Federal tax credits and renewable fuels standards affecting biodiesel. After reaching 64 million gallons in November 2009, biodiesel production fell following the expiration of the blending tax credit of $1.00 per gallon at the end of 2009. With the December 2010 reinstatement of the blending tax credit effective through December 2011 and increased requirements for biomass based diesel under the renewable fuels standard, production rebounded from a low of 22 million one year before.

Annual biodiesel production was 516 million gallons in 2009. Production fell to 343 million gallons in 2010 but then rebounded to 967 million gallons in 2011.

Soybean oil was the largest biodiesel feedstock in 2011, at 4,136 million pounds consumed. The next three largest biodiesel feedstocks during 2011 were canola oil (847 million pounds), yellow grease and other recycled feedstocks (665 million pounds), and white grease (533 million pounds).


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