# New system of subsidies for biodiesel production in the US has brought down soybean oil prices

> On April 30 the US Treasury and IRS updated guidance on the Sustainable Aviation Fuel tax credit, making soy biodiesel eligible if producers use no-till and cover crops. Chicago July soybean oil fell 5.6% that week amid South American supply and the new subsidy calculation.

- Date: 2024-05-01 · published 2024-05-01T12:00:00.000Z
- Category: policy · region US · magnitude medium
- Page: https://feedsoft.ai/events/30343-new-system-of-subsidies-for-biodiesel-production-in-the-us-has-brought-down
- Commodities: [Soybean Oil](https://feedsoft.ai/c/SBO.md)

## Why it matters

Changes to biofuel subsidy eligibility alter feedstock demand for soybean oil, and the reported price decline reflects pressure from rising South American supply.

## Read by commodity

- SBO: bearish ▼

## Linked price moves

| Commodity | Date | Window | Change % | z-score | Why linked |
| --- | --- | --- | --- | --- | --- |
| SBO | 2024-04-29 | 1 | -2.9% | -3.3 | Updated Treasury/IRS guidance on the SAF tax credit and the new subsidy calculation weighed on soyoil, though the Apr 30 guidance postdates the move and likely drove later losses. |

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| SBO | 2023-11-27 | [Soybean oil prices fall 4% amid possible reduction in demand from the biodiesel industry](https://feedsoft.ai/events/33251-soybean-oil-prices-fall-4-amid-possible-reduction-in-demand-from-the-biodiesel.md) | -0.2% | -4.1% |
| SBO | 2022-12-06 | [Soybean oil prices fall amid shrinking prospects for US biodiesel consumption](https://feedsoft.ai/events/38342-soybean-oil-prices-fall-amid-shrinking-prospects-for-us-biodiesel-consumption.md) | -3.2% | -5.8% |
| SBO | 2026-10-01 | [Rising biodiesel imports cap US soybean oil prices](https://feedsoft.ai/events/17543-rising-biodiesel-imports-cap-us-soybean-oil-prices.md) | +1.8% | +3.3% |
| SBO | 2020-11-20 | [Government authorizes import of soy oil for biodiesel production - DatamarNews](https://feedsoft.ai/events/50221-government-authorizes-import-of-soy-oil-for-biodiesel-production-datamarnews.md) | -0.3% | +3.2% |
| SBO | 2026-10-15 | [Soybean oil prices fall amid new US biofuel proposals](https://feedsoft.ai/events/510-soybean-oil-prices-fall-amid-new-us-biofuel-proposals.md) | +1.8% | — |

## Sources

- ukragroconsult.com: https://ukragroconsult.com/en/news/new-system-of-subsidies-for-biodiesel-production-in-the-us-has-brought-down-soybean-oil-prices/

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.