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  • UFOP

Global biobased diesel production rises to record level

Editor's Note: Figures include hydrotreated vegetable oil (HVO), also known as renewable diesel.

Based on official data, private sources and forecasts, the International Grains Council estimates global production of biodiesel and renewable diesel for 2023 at a record high of 71.5 million metric tons.

 


This is an 11 percent increase on the previous year and almost exclusively based on increases in North and South America and Asia.

 


The EU-27 remained the top producer, although production barely changed compared to the previous year.

 


2024 world production will presumably reach a high of 76.3 million tons and thus exceed the previous year’s output by 7 percent.

 


In recent years, the U.S., Brazil and Indonesia in particular have expanded their biobased diesel production.

 


As a result, these three countries now account for almost 60 percent of global production, compared to merely 35 percent 10 years ago.

 


In the U.S. alone, production of biobased diesel nearly doubled to nearly 20 million tons since 2020.

 


It is expected to rise further to 21 million tons in 2024.

 


Soybean oil plays an important role in terms of feedstocks used in North and South America.

 


“On the other hand, soybean meal, which has a protein content of 80 percent in the bean and costs approximately 420 euros (USD$451) per ton, is the economic driving force behind the production expansions and not soybean oil, which is traded at approximately 935 euros (USD$1,005) per ton in Germany,” UFOP stated. “The continuous rise in supply of soybean oil associated with soybean-meal production has led to a significant increase in global industrial demand, which is expected to reach a record level of 6.4 million tons in 2024-’25 (previous year: 5.9 million tons). Higher demand for soybean meal leads to expansions in area planted.”

 


In contrast, UFOP noted that consumption of soybean oil as foodstuff remained virtually unchanged, according to investigations conducted by Agrarmarkt Informations-Gesellschaft (mbH).

 


U.S. soybean-meal exports could also reach a record high volume of 15.7 million tons in 2024-’25, although the export potential will be limited by rising domestic consumption.

 


In Brazil, on the other hand, the large harvests are sufficient to cover national demand and exports.

 


Attention must be paid to the fact that for several decades Brazil has been promoting a fuel strategy that is based on passenger cars running exclusively on petrol/bioethanol and heavy-goods vehicles running on diesel/biodiesel.

 


As the blending quota is raised another 2 percent to B14 (14 percent biodiesel), domestic consumption by heavy-goods vehicles will increase accordingly.

 


Because of this, Brazil, unlike Argentina, is of comparatively little importance on the world market as an exporter of biodiesel, according to UFOP.

 


Despite recording the smallest harvest in more than two decades, Argentina was still by far the largest exporter of soybean meal—and therefore also for soybean oil—in 2022-’23.

 


For 2023-’24 and 2024-’25, soybean oil and soybean-meal exports are expected to see a respectable growth due to foreseeably larger harvests.

 


Exports of soybean products are an extremely important source of foreign currency for Argentina.

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