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Soybean oil recorded its largest daily gain since August 22.
Soybean oil futures jumped by as much as 3.8%, supported by expectations that long-awaited US biofuel blending quotas could be announced by March.
The Environmental Protection Agency (EPA) indicated last year that it would raise targets for so-called biomass-based diesel, which can be produced from soybean oil and other crop-based feedstocks.
However, traders have continued to wait for final details.
The plan is likely to be finalized in the next few months, according to people familiar with the matter. However, the timing could still change, according to sources who requested anonymity because they were discussing private information.
Production of biomass-based diesel is expected to rise sharply if the higher targets are adopted, according to Bloomberg Intelligence analyst Brett Gibbs.
He said this has long been the preferred route to support domestic biofuels and crops.
Greater use of crops in biofuel production is expected to help offset losses in export markets.
US soybean shipments are lower than last year after China, the world’s largest importer, paused purchases ahead of a high-level meeting in October.
In a related move, whole soybean futures rose by as much as 1.5%.
The US Department of Agriculture announced five export sales through its daily reporting system, including 204,000 tonnes of US soybeans to China.
China has now purchased more than 8 million tonnes of a 12 million-tonne target, while another 3 million tonnes of soybeans have been sold to unknown destinations, according to USDA data.
Meanwhile, Canada is seeking relief from Chinese tariffs on agricultural products, particularly canola.
Canola futures rose by as much as 2.2%.
Source: Bloomberg