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RVOs set to launch next biofuels boom

A professor of agricultural economics with the University of Illinois says recently announced Renewable Volume Obligations (RVOs) from the U.S. EPA stand to dramatically impact domestic soybean demand.

Scott Irwin tells Brownfield, “We’re going to have another boom that is going to be driven by renewable diesel and biodiesel.”

Irwin says the EPA’s announced intentions to award only half credit for imported fuels and feedstocks beginning in 2028 is key.

“We’re going to get more domestic feedstock use than we would have because of the incentives and the 45-Z tax credit.”  He says, “You can only get the 45-Z tax credit if you use feedstock from North America.”

He expects full implementation could drive soybean prices 50 to 75 cents per bushel higher.

“That’s a big move, and I think it’s going to be responsible for us likely turning the corner and starting to crawl out of the cyclical lows for corn and soybean prices,” he says.

Irwin says the mix of domestic and foreign feedstocks used in 2026 and 2027 will determine the extent of price impact the RVOs will have on soybeans in the near term.

AUDIO: Scott Irwin – University of Illinois