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Renewable diesel production has nearly tripled in two years to about 3 billion gallons per year, surpassing biodiesel output. Petroleum companies are investing in renewable diesel, and ADM and others are expanding U.S. crushing capacity to meet the demand for soybean oil.
Growing renewable diesel demand pulls soybean oil away from food uses and makes crush margins more dependent on fuel policy. Expanded crush also increases soybean meal supply, which is bearish for meal prices.
admadvantage.comADM Grain MarketingApr 28, 2023After 842 past bullish policy events, Soybean Oil moved a median +0.2% over 5 sessions (52% higher; middle half -1.6% to +2.1%), and -0.5% over 20.
After 223 past bearish policy events, Soybean Meal moved a median -0.3% over 5 sessions (45% higher; middle half -2.2% to +1.2%), and -0.6% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
