Biodiesel: 20 years of driving demand for U.S. soy oil

Truck and pump handle

It was the early 1990s and a small group was trying to create a market for soy oil, a product of whole soybeans that was so abundant that its market price struggled to stay above a dime per pound.

The team of farmers and scientists at the University of Missouri, with the help of Missouri Soybean Merchandising Council, managed to develop enough support and structure to push biodiesel research forward. They were forming what would eventually become the National Biodiesel Board (NBB).

Twenty years later, Kenlon Johannes remembers the first five years as a blur.

“There were only a few of us involved at the beginning, but things moved fast,” said Johannes, looking back on the 20-year history of biodiesel, which was celebrated during the recent National Biodiesel Conference. “The first five years were the fast-growth years, when the industry really started to take off.”

Now CEO of the Kansas Soybean Commission, Johannes says it’s been an interesting 20 years, which he breaks down into four quarters.

“The first five years was trying to figure things out, the second five years was convincing the industry itself that an organization was needed,” he said. “The third quarter, or the third five-year period, included a lot of legislative work and a lot of market development. Now, in the last five years, a very concise legislative, research and promotion program was developed.”

Today, biodiesel manufacturing drives demand for U.S. soy oil, which continues to be the primary feedstock for U.S. biodiesel manufacturing. The U.S. Department of Agriculture recently forecasted that one-fourth of U.S. soy oil will be used in making biodiesel this year.

In the beginning, the focus was on building a solid technical foundation for biodiesel. It had just gotten off the ground when the United Soybean Board (USB) voted to invest national-checkoff funds into biodiesel research, effectively launching biodiesel to the billion-plus gallon commercial industry that it is today.

A large portion of the checkoff’s biodiesel investments has been used for quality and performance testing, and to promote biodiesel availability and use. As a result, biodiesel is one of the most tested renewable fuels on the market. Thanks in part to the checkoff’s efforts, U.S. biodiesel production has increased from about 500,000 gallons in 1999 to more than 1 billion gallons in 2012.

In fact, NBB acknowledged the national soy checkoff’s commitment to advancing the U.S. biodiesel industry with the Eye on Biodiesel Influence Award during NBB’s recent conference. The award honors an individual or organization that has impacted public acceptance of biodiesel.

As production continues to increase, diesel users around the country will be able to find biodiesel more readily than ever before.

Johannes said it’s important for the entire industry, including soybean farmers, to “keep the momentum going.”

“Everybody involved in biodiesel has room for growth and reason to want to grow,” he said. “We’ve come a long way in 20 years, but there’s a long way to grow in the next 20 years. I hope the next 20 are as interesting as the first 20.”


The history of soy biodiesel

1990: Soy checkoff in Missouri funds first soy biodiesel research in the United States.

1992: Soy checkoff helps organize the National SoyDiesel Development Board, later renamed the National Biodiesel Board (NBB).

1993: Soy biodiesel vehicle-fleet pilot demonstrations begin.

1995: Soy biodiesel quality study funded by the soy checkoff.

1996: First soy biodiesel manufacturers register with the U.S. Environmental Protection Agency.

1997: Some school-bus fleets start to use B20 to reduce emissions.

1998: American Soybean Association helps secure law to allow soy biodiesel for federal clean-air regulatory compliance.

1999: President Clinton calls for expanded use of biobased fuels.

2000: Checkoff-funded Tier II soy biodiesel health-effects testing is submitted to the EPA.

2001: Several ag co-ops and fuel suppliers begin offering soy biodiesel to farmers and ranchers.

2002: Original soy biodiesel demonstration vehicle makes return trip to U.S. Capitol with 300,000 miles logged.

2003: Soy checkoff launches major effort to boost on-farm soy biodiesel use.

2004: Some major fuel suppliers speed up soy biodiesel distribution by installing rack injection blending and loading systems at fuel terminals.

2005: Federal tax incentive passed and implemented, which makes soy biodiesel more affordable than ever.

2006: About half of all U.S. soybean farmers indicate they use soy biodiesel in their farming operations.

2007: The U.S. biodiesel industry produces 500 million gallons of fuel

2008: President Bush signs legislation establishing the renewable fuel standard (RFS), requiring use of biomass-based diesel.

2010: The RFS program officially goes into effect. The RFS program sets annual mandates for renewable transportation fuels.

2010: New York City passes requirement that all heating oil in the city must contain at least 2 percent biodiesel, or Bioheat.

2011: NBB launches the Advanced Biofuel Initiative. US biodiesel is the only commercial-scale advanced biofuel in America, as defined by the EPA.

2011: The U.S. biodiesel industry produces 1 billion gallons of the fuel for the first time.

2012: The National Biodiesel Board celebrates its 20th year.