DAR - Darling Ingredients plunges as new biofuel mandates disappoint

2023-06-20 17:37:11 ET

The Biden administration reportedly will require oil refiners to blend less ethanol than expected into their products for the next three years, sending shares of ethanol producers and grain handlers lower in the final hour of Tuesday's trading.

Losers were led by Darling Ingredients ( NYSE: DAR ), which closed -7.2% ; also, Bunge ( NYSE: BG ) -3% , Green Plains ( GPRE ) -2.3% , Clean Energy Fuels ( CLNE ) -1.8% , Archer Daniels Midland ( NYSE: ADM ) -1.8% .

According to Reuters, the Environmental Protection Agency plans to finalize biofuel blending volumes at 20.94B gallons in 2023, 21.54B gallons in 2024 and 22.33B gallons in 2025.

The finalized volumes include 15B gallons of conventional biofuels such as ethanol in 2023, 2024 and 2025, which represents a decline from a December proposal that would have required oil refiners to add 20.82B gallons of biofuels to their fuel in 2023, 21.87B gallons in 2024, and 22.68B gallons in 2025, including 15.25B gallons of conventional ethanol in 2024 and 2025.

The final rule marks a new phase in the U.S. Renewable Fuel Standard program; the EPA is expected make its announcement on Wednesday.

More on Darling Ingredients:

• Financial and valuation comparison to sector peers
• Analysis: Darling Ingredients: Prepare For Guidance Upgrades
• Stock price return: Up 4.5% YTD, down 7% in the past 12 months

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