Advancing Biofuels: Creating A Reliable Canola Market

Trade volatility is hurting the Canadian economy and affecting the livelihoods of farmers. Supporting domestic opportunities that create reliable markets for crops is critical. For the canola industry, biofuels is that opportunity.

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From the Field to the Fuel Pump

Canada’s clean energy market is one of the fastest growing sectors in the country. Billions of dollars are being invested to increase support for domestic production and adoption of low-carbon fuels such as hydrogen and biofuels.

Domestically-sourced, abundant, renewable, and low carbon intensity – Canadian canola is exactly what biofuel producers and government regulators are looking for as a high-quality feedstock. Over the past few years, the biofuel industry has driven demand for higher volumes of canola oil, and this industry is still growing.

A Real and Growing Market for Canola

~60%

Rise in Canada's domestic canola oil consumption since 2021, driven by biofuel production

2 MMT

Canola seed demand from the new Strathcona, AB facility alone – rivalling Canada's top export seed markets

$0.62

Estimated per-bushel value added to farmgate prices in 2025/26 from domestic biofuel policy

15 MMT

Potential annual canola processing capacity on the prairies by end of 2026

Grown in Canada. Used in Canada.

As an export-driven crop, the canola market is subject to the decisions of competitors, trading partners, and global commodity prices. This isn’t news to farmers who have already seen what happens when canola demand is concentrated to a single export market.

Unlike export markets that can shift overnight, biofuels are creating reliable demand right here at home. This helps insulate the sector from external pressures and manage risk.

Did you know?

One in three acres of Canadian-grown canola already ends up in a biofuels market, but much of it goes to the U.S. for processing and is imported as a finished product back to Canada. By developing production capacity within Canada, we’re supporting rural economic development through job creation and value-added processing.

Fueling Demand for Canola

The Clean Fuel Regulations are driving the increased production of domestic biofuels. These regulations – which incentivize the adoption of low-carbon fuels, technologies, and processes – create a market that rewards producers who use cleaner feedstocks. Canola scores better on carbon intensity than corn, soy, or palm, which makes it incredibly valuable under carbon-reduction frameworks.

A similar policy exists in the U.S. – the Renewable Fuel Standard. While its stated purpose was to support the growth of the clean fuels market in the U.S. and decrease the reliance on foreign oil, it has also added an estimated $40 billion annually to US farm income. A study by the Canadian Canola Growers Association (CCGA) found that the current domestic biofuel policy is estimated to add nearly $600 million in value to farmgate prices in the 2025/26 crop year — that’s $27 per tonne, or $0.62 per bushel. And this market is still growing.

The Bottom Line

The Clean Fuel Regulations are an avenue for real economic growth for farmers. We’ve seen the success of a similar regulation south of the border. Now Canadian farmers can reap the benefits right here at home.

The infrastructure is being built. The market is growing. The opportunity is there for the taking.

Take a Deep Dive

Check back for a link to our RealAg radio program airing April 29, 2026…

This campaign is led by SaskOilseeds.

Have questions or want to get involved?

Please reach out to Ellen Grueter, Communications Manager, egrueter@saskoilseeds.com