Prices for premium-grade tallow increased on Friday, February 14, with ten railcars of technical tallow trading at 56 cents per lb Chicago and ten railcars of edible tallow at 57.5 cents per lb, closing the week on a firm note. Lard also gained, with one railcar trading higher at 52 cents per lb Chicago.
This increase was largely expected, following earlier strength in the renderer bleachable fancy tallow (BFT) market this week, which in turn helped support higher Gulf tallow prices.
By Friday, renderer-grade BFT finished 2.07% higher on the week, while Gulf tallow rose 1.36% from last Friday’s average.
Throughout the week, while market sentiment remained somewhat varied, most participants pointed to strong demand continuing to outweigh available supply, keeping conditions tight.
Others pointed to rising prices for imported material into the West Coast and Gulf — driven by increased interest in tallow imports as imported used cooking oil (UCO) is no longer eligible under 45Z — as additional factors supporting the market.
Elsewhere, after a somewhat directionless week, the nearby soybean oil market was up by 0.48% compared with last week’s average, which helped support higher distiller’s corn oil (DCO) and UCO prices throughout the week.
UCO prices in the delivered Gulf market continued to inch higher on Friday, settling at 52.5-53.0 cents per lb and lifting the week’s average by 1.77%.
The only other notable trade reported on Friday was DCO trading higher at 51.25 cents per lb FOB Nebraska for March delivery.
Other week-on-week average price increases were led by choice white grease in the Missouri River market, which posted the largest gain at 3.87%, followed by DCO rising 1.86% and yellow grease rising 1.52%.
In market news, the US Energy Information Administration (EIA) lowered its 2025 forecast for biodiesel and renewable diesel production in its latest Short-Term Energy Outlook released February 11.
The agency now expects US biodiesel output to average 103,000 barrels per day in 2025, a 2,000-bpd drop from January’s estimate, with 2026 slightly higher at 103,000 bpd.
Renewable diesel production is forecast at 233,000 bpd in 2025, also down by 2,000 bpd from the prior outlook, while the 2026 projection remains at 253,000 bpd.
The EIA anticipates total biomass-based diesel production to reach 339,000 bpd in 2025 — up by 7% year on year — with renewable diesel accounting for 69% of output.
Total production is expected to rise to 355,000 bpd in 2026, representing a 5% increase, with renewable diesel’s share climbing to 71%. Meanwhile, biodiesel and renewable diesel consumption forecasts for 2025 were also adjusted down slightly, reflecting cautious market expectations.
