New California Standard Could Boost Soybean Value

One state’s commitment to reducing carbon emissions could mean more value for U.S. soybeans. Biodiesel was recently given the best carbon score among all liquid fuels in California’s revised Low Carbon Fuels Standard, boosting the fuel’s demand potential in the nation’s most-populated state.

“California’s reaffirmation of biodiesel as a low-carbon fuel is good news for soybean farmers in the U.S.,” says Robert Stobaugh, an Arkansas soybean farmer and soy checkoff farmer-leader. “Biodiesel is great for the environment. This latest analysis shows that it’s almost as clean as electric.”

According to California’s new standard, biodiesel reduces emission between 50 percent and 80 percent relative to conventional fuel.

“Anytime we as farmers can support making our air cleaner with something we’re already doing – like producing soybeans sustainably – that’s good for all of us,” Stobaugh says.

Soybean oil is the primary feedstock for biodiesel, which is why the soy checkoff supports research to demonstrate biodiesel’s sustainability benefits. The checkoff’s life-cycle analysis of soybeans, along with other research conducted in cooperation with the National Biodiesel Board, provided data that helped California decision makers determine biodiesel’s carbon score.

One of the most interesting changes in the revised standard, says Don Scott, director of sustainability for NBB, is in indirect-land-use-change estimates. In a life-cycle analysis, researchers make estimates for the amount of land that is put into production to create a fuel rather than for other uses.

“Soybeans, for example, are 20 percent oil and 80 percent meal, so as demand increases for oil, more meal in the market has positive benefits for animal agriculture and can displace other crops,” Scott says.

That displacement was acknowledged in the new standard.

Even though farmers aren’t directly producing biodiesel, soybean farmers benefit from increased demand for the fuel. “They’re producing a low-carbon feedstock, and as California and other regions put value on carbon reduction, that commodity has a value that will benefit farmers,” says Scott.