EPA Biodiesel Blending Mandate Causes Soybean Oil Futures Price Drop

The US Environmental Protection Agency’s (EPA) 2023-2025 biodiesel blending mandate final ruling issued today, 21st June, set the renewable fuel volume targets at 20.94 billion gallons for 2023, 21.54 billion gallons for 2024 and 22.33 billion gallons for 2025, in line with estimates given to Mintec prior to the official announcement as reported here.  At the time of writing, the CBOT soybean oil futures price (Jul-23) stood at USc 53.66/lb, a decline of 4.1% from the previous day’s settlement. Market players will continue to monitor the situation in the coming days. A Mintec source stated, “‘buy the rumour, sell the fact,’ worked probably a little bit earlier before the actual publication of data,” further adding “the move is bearish, but we are going to need to see where players adjust positions in the coming days.”