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In the 90s, biodiesel became the low-carbon diesel replacement made from renewable feedstocks that helped soybean farmers benefit from the entire bean. That’s why the Ohio Soybean Council (OSC) and soybean checkoff work closely with the National Biodiesel Board (NBB) to support efforts that increase biodiesel demand. NBB continues to support soybean farmers by looking at past trends to predict and work towards a greater future for biodiesel.

According to a study done by StoneX, an institutional-grade financial services network, biodiesel adds 13% to the cash value of soybeans. USB reported that 47% of the value of the bushel is soybean oil. Today it takes about 7.5 pounds of soybean oil to produce one gallon of biodiesel.

The last three decades have shown significant strides for the biodiesel industry. In 2020, the biodiesel industry marketed 3 billion gallons of biodiesel for the first time. The industry used 9 billion gallons, or 35%, of all U.S. soybean oil in 2020, making biodiesel the second largest user of soybean oil. Food use was number one at 12 billion gallons. In 2021, NBB expects to sell at least 3.2 billion gallons of biodiesel. According to USDA, that will use 9.5 billion pounds of soybean oil, which is oil from an extra 45 million bushels of soybeans.

The Renewable Fuel Standard (RFS) under the Energy Policy Act (EPA) has been a large market driver for the biodiesel industry. The RFS program is a national policy that requires a certain volume of renewable fuel to replace or reduce the quantity of petroleum-based transportation fuel, heating oil or jet fuel. There were 2.43 billion gallons of renewable fuel used in 2020, and NBB is asking that the EPA push for 2.71 billion in 2021, driving demand for soybean oil higher.

“Biodiesel is an environmentally-friendly fuel alternative made from agricultural oils, recycled cooking oils and animal fats,” said Mike Heffelfinger, NBB board member and Ohio soybean farmer from Van Wert County. “OSC’s work with NBB increases soybean farmers’ profitability by promoting and driving demand for biodiesel.”

Carbon regulations and sustainability goals have also been market drivers for biodiesel. More than 25 states have committed to decarbonizing or partly decarbonizing their state economies. California is leading the pack as they had a 1-billion-gallon biodiesel market in 2020 due to their Low Carbon Fuel Standard, a plan which reduces petroleum dependency. In collaboration with the RFS, the state carbon regulations created a 1.7-billion-gallon biodiesel market in 2020. As other states follow, there is a predicted 3.3-billion-gallon demand by 2030.

Other market drivers include Bioheat and renewable diesel. The heating oil industry committed to transitioning to all Bioheat by 2050 due to local and state carbon regulations. Renewable diesel benefits soybean farmers because soybean oil is considered the industry’s number one choice for feedstock.

Biodiesel is better for the environment, better for the economy and better for Ohio farmers’ bottom line. NBB works to create sustainable biodiesel and renewable diesel industry growth through education, communication, governmental affairs and technical and quality assurance programs.