LUBBOCK, Texas (RFD News) — Renewable fuel mandates could strengthen demand for soybean oil and distillers corn oil, but biofuel producers must sharply increase output to meet 2026 and 2027 blending targets. CoBank analyst Jacqui Fatka says this year’s performance will shape future federal volumes.
The Environmental Protection Agency raised biomass-based diesel obligations 67 percent for 2026 and 70 percent for 2027 from the 2025 level of 5.42 billion gallons. Producers are also adjusting to the end of the biodiesel blenders tax credit.
Meeting the targets may require renewable diesel and biodiesel plants to operate near 90 percent capacity in 2026 and 95 percent in 2027. Imports, reduced exports, and stronger fuel-credit values may be needed to close remaining gaps.
U.S. crushers are expected to process 57 percent of the soybean crop this year and next, up from 52 percent in 2024. Biofuel plants are also using record volumes of soybean oil and distillers corn oil.
Producers will watch compliance data, fuel-credit prices, and legal challenges. Stronger blending could support oilseed values, but high compliance costs could weaken political support and increase market volatility.
