November 15

11/15 - The Biden Administration’s zero-carbon initiative has prompted plans for as many as 35 new biofuel plants coming online by 2024, with renewable diesel production forecast to jump from 60M gallons in 2020 to 5.1B gallons in 2024, consuming 65-75% of total U.S. soy-oil production. In last week’s WASDE, the USDA reported soy-oil usage for biofuel increasing by 24.3%, from 8.85B pounds in 2020/21 to 11.00B pounds in 2021/22, representing 43.1% of all U.S. soy-oil production. After averaging just over $.30/lb for the past 3 years (2018-2020), soy-oil futures hit record highs of $.72 in June and have since dropped back to $.5897/lb (11/12). At Market Vision’s October Conference, Brian Williams from Macquarie Bank said soy-oil looks to trade mostly in a $.55-$.68 range, and any market dips to the mid-$.50s/lb or below are contracting opportunities.