CME Soybean Oil Futures Rise Amid Increased Biofuel Demand
Soybean oil futures have surpassed 70¢ per lb, driven by heightened demand from the biofuel sector due to new EPA mandates. The EPA's biomass-based diesel requirement for 2026 is set at approximately 5.4 billion gallons, significantly higher than previous years, raising concerns about production capabilities.
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Since late February, CME soybean oil futures have consistently settled above 60¢ per lb, reaching 70¢ in late April. The EPA's new biomass-based diesel mandate for 2026 is approximately 5.4 billion gallons, up from 3.35 billion in 2025.
Achieving this mandate requires an average of 916 million RIN gallons of biomass-based diesel monthly in 2026 and 991 million in 2027, significantly more than the 592 million produced in 2025. Current production levels are at 521 million gallons per month.
The USDA's 2026-27 soybean oil production is projected at 32,590 million lbs, with 17,800 million lbs allocated for biofuel. Increased soybean acreage to 84.7 million in 2026 reflects this demand. The reliance on imports, particularly used cooking oil from China, may help meet feedstock needs. However, the ability of the US biofuel sector to meet these ambitious mandates remains uncertain.
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