What Will Renewable Diesel Mean for the Future of Soybean Production?
March 1, 2023 Recently during one of the golf tournaments I was watching, a commercial appeared from energy company Valero. This ad spot touted the company’s initiative to recycle used cooking oil to make renewable diesel.
And just like that, renewable diesel has hit the mainstream.
I found this all pretty amazing, considering I had never heard of renewable diesel before the 2022 EFC Systems Summit, where CoBank’s Ken Zuckerberg mentioned it in a speech. Compared with biodiesel, renewable diesel is much more “user friendly,” he said.
“Renewable diesel can be transported using regular diesel pipelines and it is as temperature stable as regular diesel,” said Zuckerberg at the EFC meeting. He went on to point out that if all the new renewable diesel projects in development came online in the next few years, it would require 4.1 billion bushels of soybeans production to meet the demand. In hard numbers, this would translate into 98% of the current U.S. soybean crop being utilized for just this one product effort.
To appreciate how the future of soybeans might be affected by the move to renewable diesel, consider my recent road trip through Iowa. This state, renowned for its production of corn, is already preparing for more soybean production. “It’s impossible to tell the difference between renewable diesel and regular diesel,” says Chris Behrens, Executive Vice President of Sales and Marketing at Heartland Co-op, West Des Moines, IA. “This will affect soybeans in our state going forward.”
Loading ...Troy Upah, CEO at AgState, Cherokee, IA, agrees. In fact, his company is currently building a new soybean crush plant in nearby Alta to help satisfy this increased demand for soybean oil. Ultimately, he adds, this could shift the ratio of corn to soybean production in the Hawkeye State.
“Right now, I would say the crop mix of corn vs. soybeans is 56% to 44%,” says Upah. “But over the next few years, as renewable diesel demand grows, I would expect the mix to get closer to 50/50.”
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