Unless you have been living under a rock, you have noticed that the soy complex has seen some significant upswing in prices as of late. Farmers are taking advantage of the markets and look to plant more acres to soybeans in 2021. However, so much of the biodiesel production in the state relies on soybean and soy oil prices. You may not have thought about what these prices are meaning for the production of soy-based biodiesel in the state.
Alan Weber is a Senior Advisor to the National Biodiesel Board. He says that Soybean oil makes up about 50% of the feedstocks that are being used in the production of biodiesel. He rounds out some of the other players that are involved in the blending of biodiesel.
Weber adds that while the prices of soybean oil have been advancing, the Renewable Identification Numbers or RINs are established to help keep the prices normalized in relation to petroleum prices.
Grant Kimberly of the Iowa Biodiesel Board says that when we look at Iowa?s production of biodiesel, the use of soybeans is more prevalent compared to the national averages. These mixtures can fluctuate with the prices of soybeans.
Between the drought and the derecho, soybeans were impacted. However, as Kimberly points out, soybeans are very resilient and still had some good numbers.
The bottom line is that biodiesel production is no stranger to price fluctuations and will be just fine going through this time period. Iowa is set to be able to continue leading the nation in the production of this important biofuel.
