RIN prices fell to the lowest levels since December 2020 as an acute oversupply of D4 RINs and diesel strength pressured credits over the course of September.
Selling was particularly heavy ahead of the September 21 release of the August RIN generation report which showed that total 2023 D4 generation is enough to satisfy more than 98% of the 2023 total advanced mandate.
Heavy losses in soybean oil alongside diesel strength saw the soybean oil-to-heating oil (BOHO) spread narrow to the lowest level in four months at $1.11/gallon on September 21. A narrower BOHO spread implies stronger biodiesel margins which are bearish the D4 RIN all else equal.