Biofuels industry holding up despite slumping oil prices

New York

Ethanol producers may feel less pain from sinking oil prices than in previous tough times, as a government rule ensures a minimum use of the biofuel and recent consolidation gives them both financial strength and output flexibility.

Oil prices at 2003 lows and the highest ethanol stocks for nearly four years have given some in the trade flashbacks to 2008 and 2012 when weak margins forced many plants to close.

The Environmental Protection Agency (EPA) in late November set Renewable Fuel Standard (RFS) targets that are expected to push 14.5 billion gallons of ethanol in…