Biodiesel Equipment Values 2017

By Catherine Rein, MBA, ASA Sr. Appraiser, Lee Enterprises Consulting

As we enter 2017, we’re seeing several headwinds which are depressing values in the biodiesel equipment market.  While much of the process equipment used in the biodiesel industry could be repurposed in other industries, the process equipment market in general is weaker due to lower oil and gas prices and a weak equipment investment outlook.

Both the 2017 MAPI U.S. Industrial Outlook and the EIA Biodiesel Production Forecast published in December 2016, show weak growth and weak equipment investment in the coming year.  One bright spot could be the renewable chemicals market.  The fossil fuel-based chemical industry is looking at large capital investments in basic products such as alpha-olefins and methanol as reported in the Greater Baton Rouge Business Report in November 2016.

About the Author:  Ms. Rein received her B.S. in Chemical Engineering from Colorado School of Mines, and her MBA from the University of Houston. She is an Accredited Senior Appraiser with the American Society of Appraisers and holds a designation in Machinery & Equipment appraisal. She owns Sandalwood Valuation, LLC based in Louisville, Colorado.  She has performed many alternative fuels plant and machinery and equipment appraisals, published on appraisal topics and presented at the 2008 American Society of Appraisers International Conference. She performs appraisals, assists with writing and packaging client businesses, and works with CPAs in providing full business valuations. She works with Lee Enterprises Consulting, and is available to assist with biodiesel equipment valuations for a variety of purposes, including tax, insurance, financing and accounting purposes. cathy.rein@lee-enterprises.com

Sources:

Barnes, Sam. 2017 Industry Outlook: Chemical Industry Cautiously Optimistic as Price of Oil Slowly Rises. Greater Baton Rouge Business Report November 30, 2016 https://www.businessreport.com/business/chemical-industry-cautiously-optimistic-price-oil-slowly-rises

EIA Forecasts Continued Biomass-Bass Diesel Growth Due to Final 2017 RFS Targets. December 13, 2016 http://www.eia.gov/todayinenergy/detail.php?id=29132

Waldman, Cliff. U.S. Industrial Outlook: December 2016 MAPI December 22, 2016 https://www.mapi.net/forecasts-data/us-industrial-outlook-december-2016