USDA rule could boost soybean value for biofuel tax credit

USDA on June 25 announced a final Regenerative Feedstock Rule that covers corn, soybeans, sorghum and spring canola under the 45Z clean fuel credit. The rule gives farmers a pathway to lift the value of feedstocks through voluntary conservation practices and lower carbon-intensity scores.

The American Soybean Association on June 26 welcomed the rule and said it could open a premium soybean market that lets growers benefit directly from the low-carbon fuel economy. ASA President Scott Metzger, a farmer from Williamsport, Ohio, said the change could expand domestic markets, improve basis and create a reliable local customer base for soybeans.

USDA said the final rule establishes technical guidelines for quantifying, reporting and verifying the carbon intensity of regenerative biofuel feedstock crops grown in the United States, measured against an estimated national average. The department said the rule revises technical guidelines first set in a January 2025 interim rule and will be posted for public inspection on June 26 before publication on June 29.

The rule landed alongside President Donald J. Trump’s June 25 executive order advancing regenerative agriculture, and USDA cast the package as a way to help farmers capture new value from conservation rather than leaving that value at the biofuel plant gate. That structure matters for soybean producers because the 45Z Clean Fuel Production Credit rewards transportation fuels with lifecycle greenhouse gas emissions below certain thresholds, so the farm-level carbon score can affect how much tax credit a fuel producer can claim.

The timing also follows a year of pressure from farm and fuel interests for clearer 45Z rules. The Treasury Department and Internal Revenue Service released interim guidance in January 2025, but soybean and biofuel groups argued the framework left too much unresolved. ASA renewed that push in April 2026, saying uncertainty was still weighing on soybean farmers, biofuel producers and domestic markets.

For growers, the key question is whether the final Treasury guidance will convert USDA’s carbon-intensity accounting into a real premium at the farm gate. If it does, the rule could shift some of the economics of low-carbon fuel production back to the farm, where conservation practices and commodity pricing now intersect.