Evaluating the Impacts of Missouri’s New State-Level Fuel Standard Policy
This project evaluates the impacts of a new state level fuel standard policy in Missouri in comparison with the current situation.
The project evaluates these impacts from different interrelated perspectives: diesel and biodiesel consumption in the state, Missouri out-of-state biodiesel shipments, biodiesel production, soybeans and soybean oil usage, the number of soybean processors and the number of Missouri biodiesel producers. Taken together, we estimated the impact on current biodiesel and soybean oil production capacity.
Under the new biodiesel fuel policy, the industry is expected to grow, hence, the corresponding additional economic activity from increased production of soybean, processing of soybean, and the construction of a new plant is estimated. In addition to evaluating these core components, this project included a Dynamic Flow Analysis (DFA) for biodiesel in Missouri.
The DFA modeled the flow of biodiesel from soy-based biodiesel production facilities in Missouri and selected neighboring states. Moreover, assuming the fuel standard policy were to take place, the transportation cost impact was determined and the benefits to animal agriculture were discussed.
Objectives
- Determine the additional demand for soybeans (relative to the current situation) if higher biodiesel blends as part of a fuel standard if it were to be adopted in Missouri
- Determine the impact of higher biodiesel blends on supply, demand, and movement of soybean oil to Missouri biodiesel producers
- Determine what impact higher biodiesel blends would have on the number of Missouri biodiesel producers
- Determine the impact of higher use of soybean oil as a feedstock for biodiesel on soybean crush and any resulting change in the movement of soybeans throughout Missouri and surrounding areas
- Determine what impact higher biodiesel blends would have on the number of soybean processors
- Determine the economic impact of a larger biodiesel industry in the State of Missouri
The Results
The analysis in this section evaluated the additional demand for soybeans if higher biodiesel blends (B5, B10, and B20) became part of the fuel standard in Missouri. Missouri does not currently report volumes of biodiesel sold in the state. Therefore, this data was estimated based on volumes of Missouri gross diesel (highway and non-highway) reported for fuel tax purposes and published by Missouri Department of Revenue.
This research includes a Dynamic Flow Analysis (DFA) for biodiesel in Missouri.
The DFA models the flow of biodiesel from soy-based biodiesel production facilities in Missouri and selected neighboring states.