Posts by Hoekstra Trading LLC

The recent nosedive in the price of Renewable Identification Number (RIN) credits, from $1.60 to 80 cents, has financial analysts asking refining executives how falling RIN prices might affect their future profits. For example, from last week: How do you see the RIN dynamics impacting your renewable product sales margin considering the renewable volume obligation…

Last week financial analysts asked refining executives about the nosedive in the D4 Renewable Identification number (RIN). From responses to this week’s questioning: Read more blogs in this series, RIN Price Nosedive: Below are 3 excerpts, from Neste and Valero’s 3rd quarter earnings conference calls: 1. Question from Peter Low, Financial analyst, Redburn Atlantic Hi,…

Hoekstra Trading’s “D4T” value is the calculated theoretical price of a D4 RIN using an equation published by Scott Irwin, Kristen McCormack, and James H. Stock (IMS) in 2020. It is a theoretical, not a market value, that is calculated using Hoekstra Trading’s best estimate of the values of the variables and parameters of the…

See the other posts in this series, Top 3 Takeaways: 2021, 2022, 2023, 2024 2023’s top 3 takeaways from Hoekstra Trading’s perspective: Recommendation Anyone with a stake in RINs pricing and economics should get Hoekstra Research Report 10 which includes this Hoekstra IMS RINs pricing spreadsheet that accurately calculates theoretical RIN prices, tracks them versus…

In late July, 2023, the D4 Renewable Identification Number (RIN) credit price started nosediving from $1.60 on July 25 to $1.00 on September 25.  The D4 RIN is part of the regulatory system that sets and ensures compliance with mandates on the supply of renewable fuel components in diesel fuel in the United States.  Read…

The actual price (gold) and model price (black) agreed closely in the first half of 2022. Then the model began a steady downtrend to half its peak level. The actual market price has followed this trend with a lag and a much lower slope, forming a growing gap between the theoretical and actual prices.

U.S. production of hydrogenated renewable diesel (RD), made from soybean oil and animal fats like used cooking oil, is growing faster than expected. That may sound like good news for the renewable fuels industry, but it comes with the fear that the rapid growth might trigger a sudden crash of Renewable Identification Number (RIN) prices…

The Renewable Identification Number (RIN) is an environmental credit that functions as a subsidy to force renewable fuels like ethanol and soybean oil into gasoline and diesel fuel.  Recently, chatter has bubbled up across the RINs ecosystem that RIN prices might crash to zero in the near future.  That would be headline news that would…