President Donald Trump's administration is unlikely to immediately slash blending credits for foreign biofuels and feedstocks brought into the US, but the idea remains under consideration, people familiar with the matter said.
The Environmental Protection Agency (EPA) last year floated a major revamp of the long-running biofuel program, including a plan to halve credits for blending biofuels produced abroad or made from foreign feedstocks. The Trump administration told a court last month it would finalize new biofuel quotas in the first quarter, kickstarting a last-minute lobbying campaign around whether EPA should proceed with the import-credit cuts.
Two industry stakeholders closely tracking the debate told Argus that the administration's initial idea to slash credits for foreign fuels and feedstocks at the start of 2026 is likely dead. The US has previously been more cautious when finalizing retroactive biofuel mandates to avoid legal scrutiny, and it is not clear how regulators could belatedly track whether fuels already blended were made from foreign feedstocks. Any rule, even one announced in the coming weeks, would take effect 60 days after publication in the Federal Register.
Oil refiners in particular have cast the plan as a threat to retail fuel prices and likely illegal, while US farm advocates worried about imports of renewable diesel feedstocks like used cooking oil have supported restrictions. Under the Renewable Fuel Standard program, EPA requires oil companies to annually blend different types of biofuels into the conventional fuel supply or buy credits from those that do.
But there are still advocates within the administration for cutting program credits for imports, the industry stakeholders said. A third source who is directly familiar with the administration's thinking told Argus that the half-credit idea "remains in play".
For instance, White House senior counselor for trade Peter Navarro — a longtime Trump adviser and vocal supporter of trade barriers — endorsed the half-credit proposal on Thursday in an unusual op-ed in The Hill website. "The rule closes loopholes that have allowed questionable imports to undercut American farmers and distort the market at scale," Navarro wrote.
US secretary of agriculture Brooke Rollins shared the article on social media platform X, saying it was "spot on".
Alternatively, biofuel supporters have told EPA that a record-high mandate for biomass-based diesel would support biorefineries that have struggled with policy uncertainty over the last year and guarantee strong demand for US feedstocks like soybean oil even without changes to the credit market. Some have advocated for a biomass-based diesel mandate for 2026 that amounts to between 5.2bn-5.6bn USG/yr of required blending. That is line with the Trump administration's proposal last year but would be a substantial jump from blend requirements of just 3.35bn USG/yr in 2025.
Vintage-year 2026 Renewable Identification Number (RIN) credits tied to biomass-based diesel blending under the program rose to 126.5¢/RIN on Thursday, according to Argus assessments, the highest level for current-year credits in more than two years. RIN prices were supported by higher soybean oil futures after Navarro's op-ed, as well as new EPA data that showed continued weak biomass-based diesel RIN generation in December.
EPA said it is "reviewing comments" as it "continues to work on a final regulation" and noted the court filing in which the Trump administration said it aims to finalize program updates this quarter. The White House did not respond to requests for comment.
Other more technical decisions around program implementation could affect crop demand, biofuel production margins and fuel prices. EPA has proposed slightly cutting the amount of credits generated from blending a gallon of renewable diesel and potentially requiring larger oil companies to blend more biofuels to offset recent program exemptions granted to smaller competitors.
