Neste, Bayer to develop sustainable renewable fuel feedstock from regenerative agriculture

Neste and Bayer have signed a memorandum of understanding to develop innovative vegetable oils using regenerative agriculture practices that will serve as a low-carbon feedstock for renewable products, such as biofuels.

Bayer and Neste expect to finalize a definitive agreement in 2025, the Finnish renewable refiner said in a statement Jan. 8.

Regenerative farming practices aim to trap carbon in healthier soils, promote biodiversity and reduce emissions from agriculture, while increasing farm productivity.

The two companies aim to scale winter canola production in the Southern Great Plains of the US to create a sustainable feedstock.

This partnership will also include identifying other partners and developing the value chain together.

Winter canola, when integrated into regenerative farming practices, has the potential to enhance soil health, increase biodiversity and sequester carbon.

Neste, a global leader in renewable fuels, has long focused on sourcing waste and residue materials for biofuel production. However, the company is now expanding its raw material pool by exploring innovative feedstocks such as winter canola, which can be produced sustainably using regenerative farming methods.

"Winter canola offers a promising new rotational crop that could help us reduce the carbon intensity of raw materials while providing farmers with new income opportunities and supporting environmental sustainability," said Artturi Mikkola, senior vice president of feedstock sourcing and trading at Neste.

Bayer, with its expertise in agricultural sciences, is focusing on developing low-carbon feedstocks that can meet the growing global demand for renewable fuels.

As the biofuel market expands to meet decarbonization targets, the partnership aims to help farmers adopt sustainable cropping practices that support the production of biofuels like renewable diesel and sustainable aviation fuel.

"Renewable fuels play a crucial role in decarbonizing transportation and energy sectors," said Frank Terhorst, head of strategy and sustainability for Bayer's crop science division. "Through this partnership, we are investing in new crops like winter canola and advancing sustainable farming practices to provide farmers with the resources they need to deliver low-carbon feedstocks on demand."

As renewable fuels, such as sustainable aviation fuel and renewable diesel, become increasingly important, their use is anticipated to reduce greenhouse gas emissions over their lifecycle compared with fossil fuels.

In a bid to meet the growing demand for renewable fuel, Bayer aims to launch a hybrid TruFlex winter canola in the US in 2027.