(NAFB) – Soybean farmers are getting excited about the possibility of new biofuels demand. It is called renewable diesel and differs from soy-diesel in several key ways.
Crude oil refineries around the globe are actively building out the capacity to make renewable diesel to meet tightening carbon standards. The push is already on in the United States says University of Illinois Agricultural Economist Scott Irwin.
This is because renewable diesel, when compared to soy-diesel, is favored under current U.S. law as it relates to advanced biofuels.
Some analytical firms have suggested the rise of renewable diesel, despite it just coming into the main, has already capped soy-diesel production. That being said, because it takes slightly more pounds of soybeans to make a gallon of renewable diesel (7.8 lbs) than of soy-diesel (7.5 lbs) it will drive soybean demand higher thinks Irwin.
It’s coming and already having an impact on oilseed markets around the globe says Scott Irwin, even for the price of soybeans. However, he cautions it is not yet clear how many of the intended renewable diesel refineries on the books will be built.