A biodiesel work group team was formed to address the biodiesel tax law provisions and came up with two primary solutions.Industry leaders at the National Biodiesel Conference & Expo in Orlando, Fla. predicted that biodiesel will grow to a billion gallons a year in the U.S. in the next few years looking to sustainability issues and developing the next generation of biodiesel.The tax credit, set to expire on Dec. 31, 2008, provides a $1.00 subsidy for every gallon of agri-biodiesel that is blended with petroleum diesel and 50¢/gal for biodiesel produced from recycled oils.

House Ways and Means Chairman Charles Rangel (D-N.Y.) has reintroduced the $5.5 billion block of renewable energy tax breaks Congress tried unsuccessfully to pass several times last year.H.R. 5351, the Renewable Energy and Energy Tax Conservation Tax Act of 2008, contains many of the same biofuel, solar, and wind enticements House Democrats had tried to push through via the energy bill's various failed iterations. “This bill extends critical tax credits for the production and use of renewable energy while also encouraging families to invest in technology that conserves energy,” Rangel's office said.But the new bill contains its predecessors’ fatal flaw: an attempt at revoking tax credits for oil and natural gas companies in order to pay for the biofuel and other renewable energy breaks.Last fall, Democratic leaders had targeted for repeal about $32 billion of manufacturing deductions granted to the oil and gas industry in 2004 as part of the American Jobs Creation Act, but Republican lawmakers successfully blocked the initiative every time it came up.

Maumee, Ohio-based The Andersons, Inc. last week declared its fourth consecutive quarter of record earnings in a conference call that would have been unremarkable if not for statements made by Gary Smith, the company's VP of Finance.Asked about the impact of high corn prices on the company's ethanol business, Smith made one of the first high-level acknowledgements of validity in the problem of using agriculture as fuel feedstock. In the end, if you have economics driving it and you look at the impact of a dollar increase in corn and what that does to your variable cost for reducing a gallon of ethanol, Smith said. He added, and then you look at it for what it does to your variable cost for producing a pound of beef or a pound of pork or chicken or eggs?Smith said that it’s pretty easy to conclude that you’ll keep putting corn to feed before you’ll slow down or shut down ethanol plants; before you’ll dramatically shut down feeding, and I think most of us would prefer to eat first, responding to a question about the risk to the company's ethanol margins from Wall Street Access analyst Charlie Rentschler.

Ethanol prices were last week about even versus the prior period on a nationwide basis, as stronger West Coast prices were not enough to dislodge the average spot sale, which remained at most a cent or two off the previous week.Higher West Coast ethanol prices were also offset by continued declines in Ohio area spot markets, while prices in the Midwest, which were largely stable following four weeks of declines, helped in the underpinning. East Coast prices were up about 4 cents to $2.34 a gallon on Thursday. The average national price was calculated at $2.23 per gallon, the same as the week prior, which helped effect a similar obstinacy in DeWitt & Co.'s net profit. The average plant profit stayed last week at –5.8 cents per gallon.