Biofuels Policy Outcomes Mean Business

Soybean Farmers can expect to benefit from a secure domestic market this year.

2026 has been a year of extremes for biodiesel: plants shuttered by uncertainty have roared to life with recent policy actions. For the first time, the industry has a finalized Renewable Fuel Standard, a tax credit and reallocated small refinery exemptions in the same year, locking in biofuels demand.

Importantly for soybean farmers, the Renewable Volume Obligations under the RFS for biomass-based diesel were set at their highest ever, increasing dramatically from 3.35 to 5.6 billion gallons for 2026.

“This is a vote of confidence in our ability to produce efficiently,” says Bob Haselwood, KSC representative to Clean Fuels Alliance America. “This was the first year EPA did not question feedstock availability as an issue.”

EPA’s main concern was soybean processing capacity, but that has grown suddenly in the last few years in response to demand and optimism. Kansas crush capacity nearly doubled in 2024, improving basis for many farmers. New U.S. plants coming online in 2026 will expand soybean oil availability by 1.69 billion pounds, using up more domestic feedstock and keeping the value-add and economy boost of processing within U.S. borders. Soybean oil now sits at over 70 cents per pound, having more than doubled in the last six years. Since the early 2000’s, checkoff investments and soybean advocacy efforts have grown the biodiesel industry from consuming less than 1% of the nation’s soybean oil to more than half. Biodiesel now contributes 10% to the price of each bushel of soybeans, and it continues to grow. The stability of this domestic market means more security for the farm business.