Soybean oil futures on the Chicago Mercantile Exchange for July delivery fell on Friday May 24 on profit taking ahead of the upcoming extended US Memorial Day holiday break. The nearby soy oil futures contract closed the session at $0.4495 per lb, down by 24 basis points, or 0.53%, from $0.4519 per lb a day earlier.

Soybean oil is the most widely used feedstock in the production of biomass-based diesel, and the recent prices increased on the CME has caused the soybean oil/heating oil (BOHO) futures spread to widen.

The BOHO price spread is used as a proxy to measure the profitability of producing biodiesel from soybean oil as a feedstock. The higher the spread, the more costly production becomes and vice versa.

Since the fourth quarter of 2023, US renewable diesel (RD) producers have faced a narrow BOHO spread and depressed margins.

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