Bayer and Neste have finalized a commercial agreement to jointly scale Bayer's newgold winter canola, targeting a biofuels market the two companies estimate at roughly 40 billion gallons of production by 2040.

The deal positions Bayer, headquartered in St. Louis, Missouri, to significantly expand winter canola acreage across the southern Great Plains, increasing the supply of lower-carbon-intensity oilseed feedstocks for renewable diesel and sustainable aviation fuel. The high-protein meal from the winter canola grain will move into the feed market, adding a protein source for dairy and beef cattle, poultry and swine.

"In times of geopolitical tensions, the need for more energy security and resilience while decarbonizing the transportation sector leads to growing demand for renewable fuel. This agreement further underscores Bayer's commitment to help scale biofuels production," said Frank Terhorst, head of strategy and sustainability for Bayer's Crop Science division. "We see the southern Great Plains as an untapped opportunity for winter canola. The launch of newgold winter canola will provide farmers with a profitable rotational crop with wheat and improve land utilization, while offering the opportunity to participate in a growing biofuels market."

The two companies are building what they call a newgold network with additional value chain partners to support the acreage expansion and guarantee growers an additional outlet for their grain. Offtake certainty is the linchpin of the model: the pairing of a seed developer with Neste, one of the world's largest renewable fuel producers, is designed to give southern Plains growers a demand base before the first hybrid reaches the market.

"Maximizing the contribution of novel types of raw materials to support growth in renewables requires open supply chain collaboration. By building robust value chains, we can turn agricultural innovations into scalable realities for growers and energy markets," said Artturi Mikkola, senior vice president of renewable products feedstock sourcing and trading at Neste. "Through the Bayer newgold winter canola collaboration, we are establishing a value chain in one of Neste's key markets and developing opportunities to increase farm yields and grower income. This renewable raw material can be scaled rapidly in the coming years, which can help meet increasing biofuels demand."

Bayer aims to launch newgold winter canola hybrids in the fall of 2027. The hybrids carry a stacked trait package: winter hardiness for Plains conditions, TruFlex — Bayer's second-generation Roundup Ready trait technology — and pod shatter resistance. The company says the combination offers potential for stronger yield performance and higher oil content. TruFlex winter canola, sold under the newgold seed brand, is intended to give southern Great Plains growers flexibility in deciding how and where the crop fits their rotations.

The feedstock logic behind the deal rests on the limits of electrification. Biofuels can play a key role in the transportation sector's energy transition where batteries are not practical — aviation, rail, heavy-duty equipment and marine transportation. Renewable fuel can be produced from corn, soy, canola and intermediate oilseed crops such as winter canola, which fits into existing wheat rotations rather than displacing a primary crop.

For Bayer, the canola agreement is one piece of a broader biofuels push. The company recently presented its biofuels platform at its investor day in Huxley, Iowa, highlighting an emerging portfolio of intermediate biofuel crops that includes camelina, winter canola and CoverCress.

If the newgold network delivers on its 2027 launch timeline, southern Great Plains wheat growers will gain a rotational oilseed option with a contracted biofuels outlet — and a feed market for the meal byproduct — within three planting cycles.