Biofuels and Agriculture
Society’s push for sustainable energy from renewable sources has led to heightened interest in plant and non-plant materials to replace fossil fuels for energy creation. Growing crops and non-crop commodities such as algae that can be used to produce biofuels presents a promising energy source to replace fossil fuels. The following narrative is a supplement to the information presented here and here.
Much of the interest in biofuels in the soybean world has been “fueled” by soybean’s position as the preeminent feedstock for the production of renewable diesel [RD]. In fact, soybeans are considered the “go to” feedstock for RD biofuel production. This is because, of all the crops that provide oilseeds for RD production, soybeans occupy by far the largest acreage in the U.S.
The following linked articles provide points about U.S. biofuel production that are important to U.S. crop producers both now and in the future.
• According to the EPA Renewable Fuel Standard [RFS] Program, the volume of biofuel production in the U.S. is limited according to year.
• For many soybean farmers, biofuel production is a way to improve/ensure profitability. Click here for a story and video that features Nebraska soybean farmer Greg Anderson discussing this. [Mr. Anderson is also a member of the Clean Fuels Alliance America board of directors].
• In an article titled The next farm crisis is coming–boosting biofuels can help prevent it, author Geoff Cooper of the Renewable Fuels Association discusses how prioritizing favorable U.S. biofuel policies and subsequent biofuel production can be an integral part of maintaining profitable crop production in the U.S.
• An article titled Revitalizing rural America by Emily Skor of Growth Energy presents a four-part roadmap that can be used to position biofuels to unlock the investments and jobs needed to revitalize rural America, and that will allow America to continue as the largest producer and exporter of biofuels.
• In an article titled How to capitalize on biofuels growth, author Sarah McNaughton-Peterson explains how soybean and corn producers can benefit from the biofuels market and use of biofuels to power their farm equipment.
The following are links to articles that provide points that are affecting/will affect the production and use of biofuels in the U.S.
• An article titled USDA publishes interim rule on technical guidelines for climate-smart agriculture crops used as biofuel feedstocks was published on Jan. 15, 2025. The rule highlighted in the title establishes technical guidelines for climate-smart commodity crops that are grown in the U.S. and used for biofuel feedstocks.
• The U.S. Department of the Treasury Releases Guidance on Clean Fuels Production Credit article was published on Jan. 10, 2025. The intent of this publication is to provide guidance to provide clarity about the 45Z tax credit, to include 1) who is eligible for the credit, 2) which fuels are eligible for a credit, 3) methodologies to use for calculating emissions from fuels that are eligible for the tax credit, and 4) climate-smart agricultural practices that are deemed important for reducing greenhouse gas emissions [GHG] in the production of biofuels and their feedstocks. The publication also contains a list of articles that offer more detail about the Section 45Z Clean Fuels Production Credit.
• In an article titled A Gander at Guidance on the 45Z Tax Credit for Biofuel Gallons, Scott Gerlt, American Soybean Association [ASA] Chief Economist, provides additional background on the 45Z tax credit and the calculations of carbon intensity [CI] scores that are used to determine the amount of tax credit for biomass-based diesel [BBD] feedstocks.
• An article titled American Soybean Association tackles policy issues provides information about ASA’s activities in the biofuels area that include pushing for higher allowed renewable fuel volumes as part of the Renewable Fuels Standard program.
• Despite the apparent uncertainty in the biofuels sector, an article titled Biofuels Positioned for 2025 Success Despite Policy Uncertainty projects that the handling of the 45Z tax credit by the new U.S. administration and the U.S. House and Senate will be a major driver of any expanded biofuels production in the U.S. This, coupled with higher biofuel mandates from other countries in the world and the potential of year-round E15 adoption in the U.S., boost the 2025 biofuels outlook in this country.
• An article titled Many biodiesel plants have paused production provides a link to a podcast where uncertainty in the biofuels industry is discussed as the cause for some biofuels plants to scale back or pause their operations. Specifically, information in the article indicates that RD producers have scaled back to minimum run rates, and this will impact soybean crush. The magnitude of this effect will depend heavily on activity pertaining to the 45Z tax credit.
The southern U.S. has the potential for biofuel production, and in fact, new biofuel production factilities are presently being planned in several southern states. The 7+ million acres of soybeans produced in the Midsouth states and the close proximity of those acres to the Mississippi River indicate there is the potential to supply soybean feedstock for biofuel production in this region. Thus, the intent of this article is to inform Midsouth soybean producers of this additional use of their product so that they can be aware of its availability to enhance their future profit potential.
Composed by Larry G. Heatherly, Apr. 2025, larryh91746@gmail.com