Coalition Seeks to Grow Demand for Biodiesel

July 19, 2018

Written By Adam Buckallew

When Missouri soybean farmers began investing their checkoff dollars into biodiesel research in 1991, they set the wheels in motion for the development of a renewable fuel that would drive demand for their crop and provide a clean-burning alternative to petroleum diesel.

“Biodiesel started out as an idea—an opportunity to add value to soybean oil and help the farm economy,” says Warren Stemme, a soybean farmer from Chesterfield, Mo. “Farmers invested in the technology, and then in biodiesel processing plants. Now we see biodiesel has grown into an important market, bringing both environmental and economic benefits. We’re committed to ensuring Missouri enjoys these benefits for the long haul.”

Nearly three decades later, the state’s soybean farmers have watched as their investment in biodiesel research and partnerships grew from a notion into $1.7 billion in value-added benefit to Missouri’s gross domestic product since 2007. The Show-Me State is home to eight biodiesel plants, which produce 200 million gallons of the renewable fuel annually. Missouri ranks second nationally in biodiesel output and fourth in production capacity.

As the biodiesel industry has grown, soybean farmers have begun to reap the rewards. Data from the national soybean checkoff program shows biodiesel has increased the demand for U.S. soybean oil and its value by 11 cents per pound, while adding 63 cents of value to every bushel of soybeans.

A study of the soybean value chain commissioned by the Missouri Soybean Merchandising Council shows when soybean oil is processed into biodiesel in Missouri, it adds $75 per acre to the value of the bean’s oil.

And it’s not just soybean farmers who benefitted from the emergence of the biodiesel industry. The state’s biodiesel industry directly supports more than 2,500 jobs and an additional 6,400 jobs can be linked indirectly.

Though Missouri is a leader in biodiesel production, consumption in the state has lagged. Only a few dozen retail locations offer the fuel for sale. In an effort to bring the alternative fuel’s use in the state more in line with production levels, stakeholders have banded together to form the Biodiesel Coalition of Missouri.

“For the last 10 to 12 years, we have been so focused on building up biodiesel production, and now we need to circle back and promote the benefits of biodiesel so that more people will request it,” says Stemme, who was elected chairman of the newly formed coalition.

In the short term, that means growing interest and demand at the farm level.

Company is supportive of the effort to educate end-users on the perks of filling up with biodiesel.

“We’ve been marketing biodiesel in select areas since 1993 and statewide since 2000, and basically learned the business on our own,” says James Greer, MFA Oil vice president of supply and government affairs. “Improving the public’s understanding of biodiesel’s advantages is a priority, and there’s no better place to start than the farming community.”

Greer is serving as the coalition’s vice chairman and sees room to improve the biodiesel supply stream throughout the state, which he says would help to increase the fuel’s availability.

“Infrastructure is a huge piece of the puzzle and it’s vital to ensuring biodiesel’s continued success,” Greer says.

The coalition, which brings together producers, processors, marketers and industry organizations, is looking at all avenues to build demand, including the possibility of legislation.

“Our neighbors in Illinois have a biodiesel tax incentive and have been buying biodiesel from Missouri producers, but if you look at their state’s financial situation, it’s fair to question whether that will be there long-term,” Stemme says. “Rather than depend on that, we need to be developing demand within our own state.”

Founding Members of the Biodiesel Coalition of Missouri

ADM, Cargill, MFA Oil Company, Paseo Biofuels, Biofuels LLC, Mid-America Biofuels, National Biodiesel Board, Missouri Soybean Association and Missouri Soybean Merchandising Council.

Membership is open and available to parties interested in advancing the state’s biodiesel industry. For more information, visit www.missouribiodiesel.org.