A dispute between the biofuels and oil industries in the United States could cause relevant changes in the global soybean market. The proposal by the EPA (United States Environmental Protection Agency) to expand the mandate for renewable fuels should increase the demand for soybean oil, encourage the crushing of the grain and generate knock-on effects on international prices.
The discussion takes place within the scope of the RFS (Renewable Fuels Standard), in which the proposal presented by the EPA in June 2025 envisages significantly increasing the mandatory volume of mixing biofuels in fossil fuels.
According to the text under analysis, the total mandate would rise to 24.02 billion gallons in 2026 and 24.46 billion in 2027, above the 22.33 billion predicted for 2025.
The biggest advance would occur in biomass-based diesel, which could jump from 3.35 billion gallons in 2025 to 5.61 billion in 2026, an increase of about 67%.
If confirmed, the measure could replace approximately 150,000 barrels per day of petroleum diesel, equivalent to approximately 2% of total diesel consumption in the United States.
Direct impact on demand for soybeans
Increasing the mixture would require a greater volume of raw materials for biofuel production. According to a HedgePoint survey, the proposal could generate an additional demand of around 250 million gallons of inputs per year, equivalent to approximately 5 million tons of processed soybeans.
This volume represents around 4% of current soybean production in the United States and tends to strengthen the American grain market.
The expansion of domestic demand in the United States is already beginning to redesign the international market. The expectation is for an increase in crushing capacity in the country, which could increase from 69.4 million to 74.5 million tons by 2026.
With greater demand for soybean oil, a central raw material for biodiesel and renewable diesel, the expected effect is an increase in the value of the soybean complex, also affecting the bran and the costs of the food chain, as the grain is widely used in the production of animal feed.
With more soybeans being processed domestically, bran production increases, which could put pressure on product prices if American exports do not advance at the same pace. This tends to intensify competition with Brazil in the global animal feed market.
At the same time, the greater use of soybeans for energy reduces the availability of grain for export, altering trade flows and reinforcing the role of United States energy policy as a main driver of global agricultural prices.
Another point under discussion is the change in the mandate accounting model. The proposal foresees that volumes will be measured by RINs (Renewable Fuel Identification Numbers), certificates attributed to each gallon of biofuel produced.
Under the new rules, biofuels made with imported raw materials, such as used cooking oil from China or beef tallow from Brazil, would generate only half the credits compared to those produced with domestic inputs.
This change tends to directly favor American soybeans and increase the profitability of the crushing industries.
According to information from Agrinvest, the market is already reacting to expectations about the new RFS rules. Investors await the EPA’s final decision on the approximately 5.4 billion gallon mandate, as well as the reallocation of exemptions granted to small refineries.
Cascading effect on soybean complex
For Aaron Edwards, from the American company Santos Springs, the mandate could trigger a chain effect on the agricultural market.
According to him, the initial impact tends to appear in the prices of renewable diesel and vegetable oil, then be observed in bran and, finally, in soybeans.
Edwards assesses that the decision also has a strong political component, as both the oil sector and agribusiness have great influence on discussions within the American government. “The scenario may still be affected by the trajectory of oil prices”, he informed.
If the proposal is approved before the planting of the American soybean harvest, which begins in April, the effects could appear quickly on the American market. If the decision is postponed, the changes should take place from next year’s harvest.
In Edwards’ assessment, the increase in demand for biofuels will not only benefit American soybeans, but may also benefit other large soybean producers.
“By allocating more grains for domestic consumption, the United States tends to reduce the supply of soybeans for export, opening space for Latin American countries to expand their presence in international trade,” he informed CNN Brasil.
In pressured price scenarios, adds the analyst, it is common for part of agricultural production to be directed to the manufacture of fuel and animal feed, creating business opportunities in the global grain market.
