US Biofuels Support Paves Way for New Refining Capacity

Projects to add more U.S. crushing capacity are on track next year, potentially boosting production of renewable fuels, according to Argus Media, citing North American oilseed crushers.

After a rocky start to the year for biofuels producers, U.S. policymakers have increasingly made it clear they want refineries to ramp up production and use more domestic feedstocks like soybean oil, according to a July 10 report.

The report says that while some mills delayed or canceled their plans last year due to stagnant demand, the initiative could lead to more oilseed crushing capacity.

Companies confirmed to Argus Media that more than 620,000 bushels per day of new soybean and canola crushing capacity is planned for North America next year, while others that did not respond to requests for comment also plan to ramp up production.

The report said the increased vegetable oil supply could also partly allay concerns among oil and biofuel producers that the Republicans’ protectionist approach to biofuels could lead to feedstock shortages and sharply higher prices.

South Dakota Soybean Processors CEO Tom Kersting told Argus Media that a multi-seed processing plant under construction in Mitchell, South Dakota, with a capacity of up to 96,000 bushels of soybeans per day, was expected to be operational in October of this year.

American soybean processor Ag Processing said a new 137,000-bushel-per-day soybean processing plant in David City, Nebraska, will open “later this year.”

In Canada, global agribusiness giant Cargill confirmed that a 121,000-bushel-per-day canola plant in Regina, Saskatchewan, is also scheduled to open in 2025.

Meanwhile, Louis Dreyfus Company (LDC) said it plans to complete two major projects in North America in the first half of next year. The company’s plans include building a 151,000-bushel-per-day soybean crushing plant in Upper Sandusky, Ohio, and doubling the capacity of its Yorkton, Saskatchewan, canola plant to more than 240,000 bushels per day.

The report said that U.S. soybean oil futures had risen 12% in the month prior to the report’s release after policy changes including the Environmental Protection Agency’s proposal for record-high biofuel blending requirements for 2026 and 2027, which would give refiners more incentive to expand production.

U.S. President Donald Trump’s “Big Beautiful Bill Act” was also signed into law on July 4, which includes extending the 45Z clean fuel production tax credit for two years, limiting the credit to U.S., Canadian and Mexican feedstocks, and eliminating indirect land use change (ILUC) penalties.

Tags: rapeseed, USA, biofuel, soybean, Processing, oilseeds