FutureFuel idles biodiesel production amid regulatory uncertainty, shifts full focus to specialty-chemicals growth

FutureFuel Corp., a manufacturer of custom and performance chemicals and biofuels, announced June 17 its decision to temporarily idle biodiesel production upon completion of its remaining contractual obligations, anticipated to occur by the end of June.

This decision comes despite welcome news last week from the U.S. EPA proposing to increase biobased diesel mandates for 2026 and 2027 to 7.12 billion and 7.50 billion renewable identification number (RIN) credits, respectively, which EPA projects in volumes as 5.61 billion gallons and 5.86 billion gallons—a significant jump from 3.35 billion gallons in 2025.

“We welcome the EPA’s proposed increase in biomass-based diesel mandates and thank all who supported this positive change,” said CEO Roeland Polet.

“Unfortunately,” Polet continued, “without clarity on the clean fuel producers tax credit (45Z), which was intended to replace the expired $1-per-gallon blenders tax credit (40A), FutureFuel has determined it must temporarily idle its biodiesel production for the time being.”

FutureFuel said it remains committed to the production of biodiesel and intends to restart production once regulatory conditions improve.

The company’s Batesville, Arkansas, facility, which can produce nearly 60 million gallons per year of biodiesel, boasts flexible production capacity, allowing it to seamlessly switch between specialty chemicals and biodiesel.

This unique capability sets FutureFuel apart from other biodiesel producers, the company noted.

In response to current challenges in the biodiesel industry, FutureFuel will redirect certain capacity from biodiesel production to support the growth of its specialty-chemicals business.

The company also anticipates that investment in new product capacity at its facility will come online in mid-2025.

Furthermore, FutureFuel is actively pursuing and executing a robust pipeline of chemical projects for the second half of 2025 and 2026.