Diesel sets $5.90 record as July soybean crush hits 222 million bushels
The US average diesel price hit a record $5.90 a gallon last week, AAA said, and it blamed supply disruption. Haulers and jobbers feel that directly. It also changes the math on biodiesel and renewable diesel, because the more expensive the diesel they blend into, the more the feedstock economics behind them matter to your delivered cost.
July crush
Processors crushed 222 million bushels of soybeans in July, the USDA reported. That is 4 million bushels above June, 17 million above the same month last year, and higher than the trade expected going in. Margins were good and product moved, so the plants ran hard.
A lot of that soybean oil is going into fuel. Renewable diesel plants on the West Coast and Gulf have been pulling bean oil for two years, and firm crush at these levels is the supply side keeping pace with that pull. When the crush stays strong, the oil is there for the fuel side.
For a jobber the reason to care is the RIN and the blend. Soybean oil feeds biomass-based diesel, and biomass-based diesel is where a chunk of your D4 RINs come from. Plants running means the compliance side of your diesel gallon has supply behind it, which tends to keep the RIN cost baked into your price from spiking on a shortage. Firm crush is quietly good news for anyone who has to hit a blend obligation.
Ethanol and corn
Ethanol output held up through July and kept corn demand firm. Ethanol has been the reliable blend in your gasoline for years, and nothing this week changed that. It is the steady leg of the US biofuels picture right now.
Elevated corn and soybean use does raise a question into fall harvest: what happens to feedstock cost. Good crush margins pull more beans through the plants, which supports oil supply, and at the same time the fuel side and the food side are bidding for the same bushels. If margins hold, the grind keeps up. If they slip, the oil going to renewable diesel could tighten.
Sunoil in Belgium
Sunoil Biodiesel, a Dutch producer, got regulatory approval to sell its waste-based biodiesel in Belgium. On its own this is a European story and does not move a gallon in Ohio.
It matters at one remove, and only that. Sunoil's product is waste-based, meaning used cooking oil and similar material, and that is the same global pool US renewable diesel plants buy from. Every European market that grows demand for waste feedstock is one more bidder for the stuff US plants also want, and the US already imports a meaningful share of it. Treat the Belgian approval as a small extra pull on a feedstock we compete for, and nothing more.
Labor Day gas
Gas prices stayed high over the Labor Day weekend, high enough that safety groups were telling boaters to plan around fuel cost and not stretch a tank. For a c-store operator the read is simple. Holiday demand met elevated pump prices, so volume probably held while street margins stayed tight, the way they usually do when retail is chasing cost up a holiday weekend.
What to watch
Diesel supply comes first. The $5.90 record came off disruption, so whether it eases depends on that supply coming back, and until it does the blend economics stay stretched and the delivered number stays high. Watch weekly AAA prints and any word on what disrupted the barrels.
Feedstock cost through harvest is second. If crush margins stay good, plants keep running and bean oil keeps flowing to renewable diesel, which supports D4 RIN supply. If margins slip near harvest, that feedstock could tighten and the RIN cost in your gallon could firm up. The crush report is the number to track there.
The RFS sits underneath all of it. Nothing new landed this week on the renewable volume obligations or the RIN market, but with diesel at a record and feedstock demand firm, the compliance side is where pressure could show up next. Keep an eye on D4 and D6 RIN prints and on any EPA move on the volume numbers, because that is what turns strong crush and expensive diesel into an actual change in what you pay at the rack.