“Biofuel, particularly renewable diesel, is a key driver of the demand picture on the vegetable-oil side as we look forward,” said Greg Morris,
president of Archer Daniels Midland Co.’s agricultural services and oilseeds business unit.
The U.S. Agriculture Department expects the biofuels sector to consume 12 billion pounds of soybean oil in the 2021-22 marketing year—up from an estimated 9.5 billion pounds in 2020-21, according to its monthly supply-and-demand report published in May.
Producers are racing to keep up. Production capacity for soyoil in the U.S. is expected to grow to 935 million gallons in 2021, nearly double from where it was last year, according to data from
StoneX Group.
By 2023, that capacity is expected to swell to over two billion gallons annually.
“The enthusiasm for this new generation of renewable fuels mimics what we saw in the early days of the ethanol boom,” said
Arlan Suderman,
chief commodities economist with StoneX.
ADM said last month that it would invest $350 million into building a new soybean-crushing plant—where raw soybeans are made into products like oil and meal—in Spiritwood, N.D. ADM said the facility will open before the 2023 harvest, processing as much as 150,000 bushels of soybeans a day.
Click here to see more...