US domestic renewable diesel output drives record biofuel credit generation

Clean Fuels Alliance America on July 16 said U.S. biomass-based diesel production reached 4.7 billion gallons in 2024. The volume fed the Renewable Fuel Standard’s RIN market, raising the question of whether record domestic renewable diesel output is creating more compliance credits than producer margins can absorb.

The U.S. Energy Information Administration had signaled that buildout years earlier, saying in a 2021 Today in Energy note that planned projects could lift U.S. renewable diesel production to 5.1 billion gallons a year, or 330,000 barrels per day, by the end of 2024. EIA later said U.S. biofuels production capacity growth slowed in 2024, and in a separate update it said U.S. renewable diesel production and biodiesel production declined in the first quarter of 2025.

Imports complicated the domestic supply picture. EIA said the United States imported 29% more renewable diesel in the first five months of 2024 than in the same period a year earlier, even as U.S. output kept climbing. Clean Fuels Alliance America said January renewable diesel production fell 17% below the average monthly production level, showing that the 2025 start was softer than the 2024 average.

Feedstock markets felt the change. The U.S. Department of Agriculture’s Foreign Agricultural Service said in a June 11, 2024 report, “U.S. Renewable Diesel Production Growth Drastically Impacts Global Feedstock Trade,” while USDA’s Economic Research Service said in July 2024 that renewable diesel production more than doubled and pushed biomass-based feedstock demand up by more than one-third. That kind of demand shift has kept soybean oil, used cooking oil and other lipid spreads central to RIN economics.

Quantum Commodity Intelligence also said money managers were adding to U.S. biodiesel credit net length, a sign that financial positioning remained active in the D4 market as domestic output climbed. The same publication highlighted an EPA proposal for a 67% increase in U.S. biofuels mandates, a policy backdrop that could further tighten the credit balance if finalized.

Clean Fuels Alliance America said nearly 4.6 billion gallons of biomass-based diesel were produced in 2024 in its annual report, underscoring how quickly the sector expanded. The current market test is whether that production base keeps generating enough value for renewable diesel and biodiesel plants if credit supply continues to outpace the price support those barrels were meant to deliver.