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Global biodiesel supplies increase to record highs

Increasing production of soybean meal in the US and South America is driving its utilization in biofuels and has resulted in a surge in global biodiesel supply to unprecedented levels.

According to data from official sources, private estimates, and forecasts, the International Grains Council (IGC) projects global biodiesel production, including HVO, to reach a record high of 71.5 million tonnes in 2023. This marks an 11% increase from the previous year, driven primarily by growth in North and South America and Asia.

Despite minimal changes in production compared to the previous year, the EU-27 remains the largest producer of biodiesel.

Global production is expected to further rise to 76.3 million tonnes this year, surpassing last year’s output by 7%.

In recent years, the US, Brazil, and Indonesia have notably expanded their biodiesel production capacities. Consequently, these countries now collectively account for nearly 60% of global production, up from 35% a decade ago. In the US alone, biodiesel and HVO production has nearly doubled since 2020, reaching just under 20 million tonnes, with further growth expected to 21 million tonnes by 2024.

Soybean oil, a key feedstock in North and South America, plays a crucial role. However, it is soybean meal, with its 80% protein content and approximately €420 per tonne cost, that is driving economic expansion, not soybean oil, which trades at around €935 per tonne in Germany.

The continuous increase in soybean oil supply linked with soybean meal production has significantly boosted global industrial demand, projected to reach a record 6.4 million tonnes in 2024/25, up from 5.9 million tonnes in the previous year.

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