04.24.2024
Biodiesel output strong in Q2; producers start locking in Q3-Q4 sales
A second producer echoed this sentiment and said they have had to work a bit harder to secure feedstock to line it up with sales at the right time.
Choice white grease prices out of the Missouri River market increased steadily over the last 12 weeks. The rally in both corn and soybean oil prices have been a significant driver in the market as has strong demand from the feed and biodiesel sectors. The bulk of trading has been done this week at an average of 27.5 cents per pound, but there have been indications of material trading as high as 30 cents FOB into the renewable sector.
Anecdotally, colder temperatures bring about reduced demand for animal fats from the biodiesel sector, but a closer look at the data show otherwise. Per pound usage in 2016, 2017, and 2019 was higher versus the third quarters of those same years. The average choice white grease usage in the fourth quarter for 2016 – 2019 is 49.9 million pounds per month; in the third quarter, the average is 40.5 million pounds per month. Additionally, choice white grease as a percentage of total feedstock usage increased in the fourth quarters of 2016, 2017,…