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EPA unleashes Canola oil for Renewable Diesel production

Although canola oil has been used for conventional biodiesel since 2010 and rapeseed oil since 2013, it was not yet approved for Renewable Diesel until now. EPA further combined the canola/rapeseed into one category now enabling both Biodiesel and Renewable diesel to use such feedstock. It is somewhat baffling that such action has taken 10 years in the making! This will help Renewable Diesel plant to produce HVO/RD with cold properties more in line with demand in winter and certainly help with production of Sustainable Aviation Fuel. This will also take significant pressure off Soyoil in winter time as demand will swing more towards canola oil with its better cold properties for Renewable Diesel. The inclusion of Rapeseed Oil in the same category also opens the pandora box for further arbitrage. Presumably now RME

produced in Europe with either canola or rapeseed oil under RFS rules could now make its way to US. Since Europe is a large importer of Australian Canola seeds, this changes possible arbitrage of canola oil and RME produced in EU in favor of US RFS markets.

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