For most of the week, trading remained quiet and subdued, a welcome change for many. Notably absent were the usual rumors surrounding RVOs or SREs. However, after hours on Thursday and into Friday’s session, a new rumor began to circulate.
The buzz suggested an amendment to the Renewable Fuel Standard (RFS) that would assign Imported Used Cooking Oil (UCO) only 50% of a RIN credit, compared to the current 150% per gallon for biodiesel and 170% per gallon for renewable diesel. This speculation triggered a sharp reaction, sending soybean oil prices up 100 points at the open.
Despite the market’s response, this appears to be yet another baseless rumor lacking any substantive backing. Implementing such a change would require a legislative amendment—no small feat.
The April edition of the NASS Crush Report was released, showing soybean oil stocks at 1.975 billion pounds—missing analyst expectations by approximately 100 million pounds. This miss has added to growing frustration among analysts regarding the accuracy and tracking of stock data. Some are anticipating a significant revision in next month’s report.
April’s import/export data, released on Thursday, provides the first full picture of trade flows following the implementation of Trump’s “Liberation Day” tariffs. As highlighted in our newsletter, UCO imports fell sharply—down 55%—with Chinese volumes nearly disappearing. In response, Australia stepped in to partially offset the shortfall, increasing its UCO exports to the U.S. by 68%. Meanwhile, tallow imports surged 52% month-over-month, with Brazil accounting for the majority of that increase. We’re now looking ahead to the EIA feedstock report, out on June 30, the import shifts would indicate tallow replacing UCO consumption.
Looking Forward
Another week has passed without any policy clarity. The market continues to await the EPA’s announcement on Renewable Volume Obligations (RVOs). Sentiment around the timing of the release has turned more cautious, with many now eyeing mid-to-late June, following the addition of new meetings to the Office of Management and Budget (OMB) schedule. That said, the OMB has previously released RVOs even while meetings were still pending, so a surprise release remains possible.
On the technical front, we highlighted a potential head-and-shoulders pattern in July bean oil futures earlier in the week. While the pattern did not break to the downside as expected, we maintain a bearish outlook in the absence of a policy announcement or market-moving rumor.
The StoneX Biodiesel Board Crush (BBC) saw a gain of 10 cents. Bouncing off lows to start the week. While bean oil over the past two weeks drifted lower, the biggest loser has been RINs. D4 RINs dropped from $1.20 at the beginning of the month to $1 today. An RVO announcement would give RINs some decent support but until we get clarity on SREs the trade could expect RINs to wonder. In a world with no $1 BTC RINs will have to do more of the heavy lifting. See StoneX BBC chart below.
- Dates to Watch
- Monday, June 15, 2025: NOPA Crush Report
- Thursday, June 19, 2025: May EMTS RIN Generation Data
- Monday, June 23, 2025: Last OMB meeting on the RVO
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