Two decisions taken in late March 2026 confirm that energy policy has become the single most powerful force in the vegetable oil market.

United States: record biofuel targets confirmed

The US Environmental Protection Agency has finalised its Renewable Fuel Standard volumes for 2026 and 2027. The biomass-based diesel mandate is set at around 5.4 billion gallons in 2026 and 5.5 billion gallons in 2027, compared with 3.35 billion gallons in 2025. The EPA also decided to reallocate 70% of past small refinery exemptions into future obligations. According to the agency, production of biodiesel and renewable diesel will need to increase by more than 60% compared with 2025. The proposed reduction of credits for imported feedstocks was not adopted for now and is expected to be revisited for 2028.

Indonesia: B50 is back

After announcing in January that it would keep its biodiesel blend at 40%, Indonesia reversed course at the end of March and confirmed that a 50% palm-based biodiesel blend (B50) will be introduced from 1 July 2026, with a transition period. To fund the programme, the export levy on crude palm oil was raised from 10% to 12.5% from March. Industry estimates suggest B50 could absorb an additional 1.5–2 million tonnes of palm oil per year. Palm oil prices reached their highest level in about 15 months on the news.

What it means

  • Less oil for food markets. Indonesia is the world's largest palm oil exporter, and the United States is a major soybean oil producer. Both will keep more oil at home.
  • Stronger demand for South American oil. Importers in South Asia, the Middle East and Africa will lean more on Argentine and Brazilian soybean oil.
  • Firm oil, soft meal. Higher crushing to supply biofuel plants adds meal to the market, keeping protein meal prices competitive for feed buyers.

Our view

We expect vegetable oil prices to stay firm relative to grains and meals through 2026. For food manufacturers and refiners, earlier and longer forward coverage is advisable. DBI Resources supplies palm, soybean and sunflower oils and can structure supply programmes that reduce exposure to policy-driven price swings.

Sources: US EPA, final RFS rule for 2026–2027, March 2026; Government of Indonesia statements, March 2026; Malaysian Palm Oil Board.