The US Energy Information Administration (EIA) today trimmed further its outlook for domestic biomass-based diesel production in 2025 while raising its forecast for next year.
US renewable diesel production is expected to average 205,000 b/d in 2025, EIA said Tuesday in its monthly Short-Term Energy Outlook. That was down by 1,000 b/d from its June estimate and a more than 30pc drop from the agency's initial outlook for this year's production.
EIA also cut its expectation for 2025 consumption of renewable diesel to 191,000 b/d, down by 5,000 b/d from the June outlook. The lower demand outlook coincides with EIA's cut to expected distillates demand because of muted economic growth.
The combined production and demand outlooks imply about 16,000 b/d of net renewable diesel exports this year compared with 34,000 b/d of US net imports last year. Foreign biofuels are no longer eligible this year for a federal tax credit, sharply reducing the incentive to import.
Biorefineries have run at lower rates this year because of thin margins and uncertainty about future blend mandates and tax credit policy, although the government has slowly provided more clarity on plans for future years.
In 2026, EIA expects 255,000 b/d of renewable diesel production, a 6,000 b/d hike from last month's outlook to what would be an all-time annual high after rapid growth leading up to this year. The agency predicts 234,000 b/d of renewable diesel consumption next year, a 1,000 b/d drop from last month's expectation.
Trends were similar for biodiesel, with the agency forecasting tougher economics this year but more output next year. The report now projects 90,000 b/d of US biodiesel production this year and 91,000 b/d of consumption, both down by 1,000 b/d from the June forecast. In 2026, EIA expects 103,000 b/d of biodiesel production, 4,000 b/d more than last month's forecast, with biodiesel consumption at 100,000 b/d, a 3,000 b/d increase from the June report.
EIA expectations for "other biofuels", which includes sustainable aviation fuel made through a similar hydroprocessing method as renewable diesel, have generally been more optimistic this year. The latest report keeps projections for this year steady at 38,000 b/d of production and 37,000 b/d of consumption. But the agency now sees US production and consumption balanced at 49,000 b/d next year, a 1,000 b/d increase from its June expectations.
The Environmental Protection Agency last month proposed substantially raising biomass-based diesel mandates in the next two years, while also potentially throttling credits for biofuels made abroad or from foreign feedstocks. And President Donald Trump signed into law over the weekend a sprawling budget bill that extends a tax credit for biofuels through 2029 and, starting next year, ups subsidies for crop-based fuels while limiting eligibility to North American feedstocks.
