Global biodiesel production rises to record level

The increase in production was driven by growing soyabean production in the USA and South America, the 6 June report said.

Based on official data, private sources and forecasts, the IGC estimated global 2023 production of biodiesel – including hydrotreated vegetable oil (HVO) – reached a record high of 71.5M tonnes.

This would be an 11% increase on the previous year and almost exclusively based on increases in North and South America and Asia.

Although there was little change in production in the EU-27 compared to the previous year, the bloc remained the leading producer worldwide.

Global production in 2024 was expected to reach a high of 76.3M tonnes, exceeding the previous year’s output by 7%.

In recent years, the USA, Brazil and Indonesia had expanded biodiesel production, with the three countries accounting for almost 60% of global production, compared to 35% a decade earlier.

Since 2020, biodiesel and HVO production in the USA had almost doubled to just under 20M tonnes and was expected to increase by another 21M tonnes in 2024.

Soyabean oil plays an important role in terms of feedstocks used in North and South America, according to the report.

However, soyabean meal, which had a protein content of 80% in the bean and cost approximately €420 (US$451)/tonne was the economic driving force behind rising production rather than soyabean oil, which traded at approximately €935 (US$1,004)/tonne in Germany.

An ongoing rise in soyabean oil supply associated with soyabean meal production had led to a significant increase in global industrial demand, which was expected to reach a record level of 6.4M tonnes in 2024/25, compared to 5.9M tonnes the previous year, the report said.

Higher demand for soyabean meal has led to planted area expansion while soyabean oil consumption in the food sector remains virtually unchanged, according to research by Agrarmarkt Informations-Gesellschaft.

US soyabean meal exports could also increase from 14.3M tonnes in 2023/24 to a record volume of 15.7M in 2024/25, although the export potential would be limited due to rising domestic consumption.

In Brazil, large harvests would cover national demand and exports.

Following a 2% increase in the blending quota to B14 (14% biodiesel) in Brazil, domestic consumption by HGV vehicles would increase accordingly, the report said. For this reason, Brazil – unlike Argentina – was not a leading biodiesel exporter on the world market.

Despite recording its smallest harvest in more than two decades, Argentina was still by far the largest exporter of soyabean meal – and consequently also of soyabean oil – in 2022/23.

In 2023/24 and 2024/25, Argentine soyabean oil and soyabean meal exports were expected to increase due to forecasts of larger harvests.

Exports of soyabean products are an important source of foreign currency for Argentina, the report said.