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Unclear biofuels policy update affects soybean oil

The chief commodities economist with StoneX Group says the lack of clarity on the Trump administration’s biofuels policy has been weighing on soybean oil prices this week.

Arlan Suderman says it’s unclear when the U.S. EPA will release more information about renewable volume obligations and small refinery exemptions.

“How will those two fit together? Will it be a high RVO, but a high SRE? A low RVO and a small SRE or some combination in-between? The net of those two will tell us what our demand for biomass-based diesel and ethanol will be.”

Suderman says there have only been rumors about when more information will become available and analysts will keep a close eye on that information, because biofuels policy determines domestic demand.