The US interior soybean oil cash market remains incredibly tight, with the nearby basis retaining a premium to levels for the end of the year, market sources said.

On Wednesday September 4, Fastmarkets assessed soybean oil, basis, crude-degummed, fob central Illinois at a premium of 150-250 basis points per lb to the October soy oil futures contract on the Chicago Mercantile Exchange. This was up from a premium of 75-200 basis points per lb on Tuesday.

Higher spot basis levels for September delivery compared with those for the remainder of the fourth quarter are reflective of tight stocks of both soybeans and soy oil, a market source said.

“There is a lot of uncertainty out forward with policy and mandates still lingering and [the] 45Z [tax credit],” the source said.

Soybean oil is the most widely used feedstock in the production of biomass-based diesel and renewable diesel.

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