Terrain turns into big grid of one specific chunk in 32 chunk render distance

Put the summary of the bug you're having here

What I expected to happen was...:
I would see 32 chunks rendered

What actually happened was...:
I saw the same one chunk rendered in the entire 32x32x32 chunk space

Steps to Reproduce:
1. Start MC 1.8.1
2. Open any SP world
3. Change render distance to 32 chunks