US demand for rapeseed oil in biofuel production set to rise by more than 50%

US rapeseed oil consumption for biofuel production could increase by more than 50% in the MY 2026/27, reaching 2.54 mln tons compared with 1.68 mln tons in the previous season. According to the US Department of Agriculture (USDA), the increase is driven by growing demand for renewable diesel and tax incentives for producers, particularly the federal 45Z clean fuel production tax credit. Expansion of the biofuel sector is becoming one of the main drivers of the US rapeseed market and its processing industry.

Against the backdrop of rising demand, US rapeseed production could reach a record 2.45 mln tons in 2026/27. The increase will be driven primarily by expanded planted area, as farmers seek to benefit from stronger demand from the food and biofuel industries. However, USDA expects average crop yields to decline, partially offsetting the increase in production.

North Dakota remains the largest rapeseed-producing state in the US, with planted area expanding by 29% in 2026 to 2.33 mln acres, or approximately 943 thsd ha. Increased plantings were also reported in Minnesota, Montana, Washington, Oklahoma and Kansas. Despite the expansion in acreage, USDA forecasts a 10% decline in the national average rapeseed yield to approximately 2.03 t/ha.

Domestic rapeseed crushing in the US is projected to increase by 11% year on year to 2.4 mln tons in 2026/27. The increase will be supported by expanded processing capacity, including the commissioning of a new crushing facility during the marketing year. Higher rapeseed oil production is expected to help meet the needs of the biofuel industry, where demand for vegetable oils continues to grow.

Meanwhile, USDA forecasts US rapeseed exports to rise to around 408 thsd tons. Domestic consumption for food, feed and other industrial uses is also expected to increase by approximately 4%. The US rapeseed market will therefore be shaped by simultaneous growth in production, crushing and demand for rapeseed oil from the biofuel sector.

Tags: USA, rapeseed oil, biofuel