US biofuel sector shrinks despite flood of cheap soyabean supply

Chicago

MAKERS of renewable fuels derived from the vast soya bean fields across the American Midwest cannot seem to catch a break. At a time when crops are cheap and domestic demand for biodiesel has never been better, the industry is shrinking.

Imports from places such as Argentina, Singapore and South Korea ballooned to a record 538 million gallons (two billion litres) last year from just seven million in 2009, while the US has idled half of its three billion gallons of production capacity, industry data show. Foreign suppliers are accelerating shipments this year and next, capitalising on new incentives and an expanded federal mandate for usage, as well as tougher emission rules in California, the most-populous state.