US renewable diesel and biodiesel production fell in Q1

US production of renewable diesel and biodiesel fell sharply in the first quarter of 2025 (1Q25) because of uncertainty related to federal biofuel tax credits and negative profit margins, according to the Energy Information Administration (EIA).
The EIA forecast production of both fuels to increase as the year progresses but biodiesel production to remain less than in 2024.
Renewable diesel and biodiesel are biomass-based diesel fuels that can replace petroleum-based distillate and be used to comply with renewable volume obligations in the Renewable Fuel Standard (RFS) administered by the US Environmental Protection Agency (EPA).
In January 2025, US production of biodiesel fell to 60,000 barrels per day (b/d), the least since January 2015, and about 40% less than in January 2024. US biodiesel producers only partially ramped up production in February and March, bringing the quarterly production to about 70,000 b/d, a decrease of more than 30% from 1Q 24.
US renewable diesel production averaged about 170,000 b/d in 1Q25, down 12% from 1Q24.
The decrease in renewable diesel production was not as large on a percentage basis as the decrease in biodiesel production, mostly because renewable diesel production increased at a greater rate than biodiesel production in 2024. Reduced output at renewable diesel plants was partially offset by the nearly 20% increase in renewable diesel production capacity since 1Q24.
However, compared with 4Q24, when renewable diesel production capacity was comparable to current levels, 1Q25 production was down almost 25%.