This project will conduct analysis of interactions between biofuel policies and their market impacts

The Department of Agriculture Office of the Chief Economist awarded a $100,000 cooperative agreement to the University of California, Davis on September 30, 2025, under the Agricultural Market and Economic Research program (CFDA 10.290) to conduct analysis of interactions between biofuel policies and their market impacts.

The project examines market and trade impacts and secondary market impacts to provide a foundation for evaluating impacts on farm returns from current and potential future biofuel policy changes. The analysis addresses three primary questions: how much differing state and federal policy incentives for biomass-based diesels counteract each other; what potential impacts exist on U.S. crop prices, particularly soybeans, from conflicting state and federal policies; and what secondary impacts on crop markets in the United States and globally result from increased consumption of waste oils in biofuel markets, including possible price impacts on domestically produced soybeans.

Performance occurs in California with a period of performance ending September 30, 2027. The cooperative agreement is a direct award to the ultimate beneficiary with no pass-through sub-recipients.

The effort will examine areas which may include market and trade impacts and secondary market impacts to provide a foundation for evaluating impacts on farm returns of current and potential future biofuel policy changes by addressing three primary questions: (i) how much do differing state and federal policy incentives for biomass-based diesels counteract each other? (II) what are the potential impacts on US crop prices-soybeans in particular-from conflicting state and federal policies? (III) what are the secondary impacts on crop markets both in the united states and globally from increased consumption of waste oils in biofuel markets, including possible price impacts on domestically produced soybeans?