4 Critical Insights for the Q4 2025 and 2026 Biofuels Market

ResourceWise recently hosted the webinar Finding Feedstocks: Biofuels Outlook Q4 2025, which you can now watch on demand. Matthew Stone, VP of Business Development and Low-Carbon Fuels at ResourceWise, explored the forces shaping today’s biofuels and feedstocks markets.

The conversation highlighted the volatility, policy shifts, and trade realignments that will continue to define the industry now and into 2026. Below, we’ve identified four of the most critical insights from Stone’s talk.

1. Policy Changes Will Reshape Market Dynamics

Both the US and Europe are undergoing major policy shifts that will set the tone for Q4 2025 and into 2026.

In the US, recent regulatory announcements are expected to have broad implications both domestically and for international markets. This is especially pivotal right now as trading partners adjust to new compliance and credit structures.

In Europe, the rollout of RED III brings another round of complexity. Implementation will vary across member states, creating uneven impacts but generally driving higher demand for renewable fuels.

These evolving frameworks are more than bureaucratic hurdles. They are shaping investment decisions, influencing feedstock sourcing strategies, and rewriting the rules of competition in the global marketplace.

2. Demand Growth Driven by Higher Mandates

Across Europe, blending mandates are tightening and renewable fuel requirements are being pushed higher. The first half of 2025 saw markets lagging behind on blending progress. However, the latter part of the year is already showing catch-up activity.

Looking ahead to 2026, RED III’s aggressive targets will force countries to scale up more quickly. The change will add substantial demand pressure across the board.

For producers and suppliers, this is both a challenge and an opportunity. Meeting these mandates will require careful planning, diversified feedstock sourcing, and strong risk management. For those positioned correctly, the wave of demand could unlock significant growth potential.

3. Trade Flows Are Shifting in North America

On the North American front, Canada is stepping into a bigger role in the regional biofuels picture.

Under the USMCA framework, Canadian feedstocks are increasingly moving into US markets, tightening integration across the Atlantic Basin. Meanwhile, US policy choices, especially around tariffs and international trade, seem to be creating an uneven playing field.

This divergence is important to highlight for several reasons. If Canada remains more open and integrated while the US takes a more protectionist stance, North America could see price discrepancies and fragmented supply chains.

For market participants, closely monitoring these evolving trade dynamics will be essential to avoid disruptions and seize emerging opportunities.

4. Pricing Pressures Reflect Supply and Policy Tension

Soybean oil, a critical benchmark feedstock, has been under downward price pressure throughout 2025. This has pulled broader feedstock pricing lower, softening the near-term market outlook.

Despite the decrease, this weaker pricing could actually set the stage for a stronger rebound in the US going into 2026. We may see recovery if demand surges under tighter mandates and policy incentives.

To put this into a broader perspective, global markets often take their pricing signals from US soybean oil. That means today’s softness could quickly turn into tomorrow’s rally if policy-driven demand collides with constrained supply.

The balance between affordability and availability will remain one of the most important watchpoints in the months ahead.

Get the Full Biofuels and Feedstocks Picture with On-Demand Webinar

The Q4 2025 and 2026 outlook for biofuels and feedstocks is defined by uncertainty. But with this uncertainty comes immense opportunity with the right strategy in place.

Policy shifts, tightening mandates, shifting trade routes, and evolving price signals all point toward a market that is both challenging and full of potential for those who stay ahead of the curve.

Want to hear the full discussion, with deeper analysis from Matthew Stone? The webinar Finding Feedstocks: Biofuels Outlook Q4 2025 is now available on demand. Watch now for even more insights on what you need to navigate this complex market.