USA: Used cooking oil pressures soybean oil

The United States is grappling with a surge in used cooking oil (UCO) imports from China and tallow imports from Brazil, which are undermining the country's soybean crush expansion and displacing soybean oil in the U.S. biofuel sector. Between January 1, 2023, and June 30, 2024, the U.S. imported 7.9 billion pounds of UCO and tallow, equivalent to the soybean oil crushed from over 650 million bushels of soybeans, causing used cooking oil prices to plummet and crop prices to reach near four-year lows. This has led to concerns and calls for investigation by U.S. senators and farm groups, as well as discussions on restricting Section 45Z Clean Fuel Production Tax Credit eligibility to domestically sourced feedstocks. The situation highlights the need for the U.S. to increase domestic demand for its corn and soybeans, as exports of these commodities are declining.

The United States continues to face a tsunami of used cooking oil imports from China that is undermining the country’s soybean crush expansion, says an analyst. The U.S. imported 3.2 billion pounds of UCO through the first eight months of 2024, which is double the volume for the same period one year ago. Dan Basse, president of AgResource Company, said the imported UCO from China and tallow from Brazil are displacing soybean oil in the U.S. biofuel sector. “Those two have kind of overwhelmed the soybean oil demand story,” he said during a recent Agri-Pulse Open Mic Interview. The National Oilseed Processors Association (NOPA) noted in a recent news release that the U.S. imported 7.9 billion pounds of UCO and tallow between Jan. 1, 2023, and June 30, 2024. That is the equivalent to the soybean oil crushed from more than 650 million bushels of soybeans. Basse said that is disturbing because it was only a few years ago that the U.S. soybean industry announced it would be building 600 ...