Stock Markets June 16, 2026 05:38 PM

Cargill Assessing Beef Tallow for Brazilian Biodiesel as U.S. Tariffs Weigh on Exports

Company launches feasibility project for animal fat use after U.S. duties dent attractiveness of tallow shipments

By Maya Rios
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Cargill has initiated a project in Brazil to evaluate whether beef tallow can be used to produce biodiesel, a response to U.S. tariffs that have diminished the appeal of exporting the animal fat. The company does not currently process tallow for biodiesel but cites prior operational experience at an acquired plant that previously used the feedstock. U.S. duties of 10% on Brazilian beef tallow, which industry representatives say could increase, have prompted the search for alternative markets and applications.

Cargill Assessing Beef Tallow for Brazilian Biodiesel as U.S. Tariffs Weigh on Exports
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Key Points

  • Cargill has initiated a project in Brazil to study the feasibility of using beef tallow to produce biodiesel; it does not currently use tallow in biodiesel production.
  • One of the three biodiesel plants acquired by Cargill from Granol in 2023 previously used tallow, indicating no apparent operational hurdles at that facility.
  • U.S. tariffs of 10% on Brazilian beef tallow - which industry representatives say could rise - have reduced the attractiveness of exporting tallow to the United States, prompting Cargill to explore domestic demand.

SAO PAULO, June 16 - Cargill is conducting a feasibility study to determine whether beef tallow can be utilised to make biodiesel in Brazil, a trader for the company said on Tuesday. The move comes as U.S. tariffs have reduced the attractiveness of exporting animal fat to that market.

According to trader Paulo Cardoso, Cargill does not presently use beef tallow in its biodiesel production. Cardoso said the company has launched a project to assess the viability of the feedstock in its Brazilian operations.

Cardoso noted that one of the three biodiesel plants Cargill acquired from Brazilian firm Granol in 2023 had previously used tallow, which suggests there are no immediate operational constraints to processing the animal fat at that location.

Brazil relies primarily on soybean oil as its main biodiesel feedstock, while beef tallow is the country's third-ranked input for biodiesel production. The new feasibility work examines whether Cargill can integrate tallow into its fuel supply chain under current market and policy conditions.

Cardoso said U.S. taxation "opened eyes" to the need to seek out new markets for tallow, and he recalled that Cargill's Brazil unit had previously served as a major exporter of tallow to the United States.

U.S. tariffs on Brazilian beef tallow currently stand at 10%, and industry group Abrafrigo has indicated that those duties could increase. That taxation on tallow exports has been cited by the company as a factor prompting a search for domestic applications and alternative markets.

The feasibility project is an exploratory step: Cargill is examining whether beef tallow can be a practical feedstock for biodiesel in Brazil, but the company has not moved to processing tallow in its operations as of Cardoso's comments. The presence of a formerly tallow-capable plant among its recent acquisitions provides a potential operational pathway should the feasibility findings prove favorable.


Context for markets and industry

The developments touch on several parts of the value chain: exporters of animal fats that previously relied on U.S. demand, biodiesel producers in Brazil assessing feedstock mixes, and trade flows affected by tariff policy. The company's study signals how policy measures can influence corporate decisions on sourcing and processing feedstocks for renewable fuels.

Risks

  • Tariff uncertainty - U.S. duties on Brazilian beef tallow stand at 10% and could increase, which would further affect export economics for producers and traders (impacts agriculture and trade sectors).
  • Project uncertainty - Cargill is only studying feasibility and has not adopted tallow in current biodiesel operations, so there is a risk the study may not lead to commercial use (impacts biodiesel producers and feedstock suppliers).
  • Market displacement - reduced U.S. demand for tallow could pressure exporters to find alternative markets or applications, affecting prices and trade flows in the animal fats market (impacts agriculture, renewable fuels, and trade sectors).

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