Soybean Oil Use by the Biofuel Industry Forecast Lower

The USDA lowered demand expectations from the biofuel industry for soybean oil in both the 2020/21 crop year and the 2021/22 crop year in their August World Agriculture Supply and Demand estimates (WASDE).  Soybean oil estimates for 2020/21 soybean oil use were revised 200 million pounds lower to 9.1 billion pounds. The 2021/22 forecast for soybean oil use in biofuel production moved from 12 million to 11.5 million pounds in August.

The USDA did not provide detail on biofuel demand falling for soybean oil use.  However, some recent news on capacity coming online may have swayed the decision.  CVR announced they were pausing bringing their first plant online due to rising feedstock costs and were pausing further development on their second plant. Another plant in Oregon that was scheduled to begin production in 2020 is also stalled.

There are still plenty of reasons to believe…