Prices of soybean and soy oil have climbed sharply in recent sessions, touching multi-month highs amid tight supplies and strong export demand. While global palm and sunflower oil prices have shown weakness, soybean complex prices are moving in the opposite direction, raising questions about whether the upward trend will sustain in the coming months.

Soybean and Soy Oil Reach 3–7 Month Highs

Soybean prices have surged to a three-month high, while soy oil has climbed to its highest level in seven months. The rally is largely attributed to limited arrivals in domestic markets and a rise in soymeal exports, which has strengthened overall demand for the soybean complex.

Internationally, soy oil prices have approached the $58 mark, supported by active buying from crushers and weather-related concerns in Argentina. In the domestic market, soybean prices have been quoted around ₹5,500–5,600 per quintal, reflecting firm demand and supply constraints.

Market participants say that weather risks in major producing countries are adding to bullish sentiment. Uncertainty around crop conditions often leads to precautionary buying, which further fuels price momentum.

China’s Buying and Weather Risks Add Support

China’s continued buying interest has provided additional support to soybean prices. Meanwhile, Brazil — one of the world’s largest soybean producers — is currently harvesting its crop. Production estimates suggest a potential output of nearly 180 million tonnes.

However, heavy rainfall in key growing regions has slowed harvesting progress. Reports indicate that only around 21% of the crop has been harvested so far. Excessive rains have also raised concerns about potential crop damage, which could impact global supply dynamics.

Weather volatility in South America remains a crucial factor for global oilseed markets, and any further disruption could keep prices firm.

Contrasting Trend in Palm and Sunflower Oil

In contrast to soy oil, palm oil prices in international markets have witnessed a decline. Palm oil prices have fallen near 4,000 ringgit levels, while sunflower oil prices have slipped to around $1,500 per tonne, touching one-month lows.

Lower palm oil prices have boosted imports, with February shipments expected to reach approximately 8 lakh tonnes. Reduced prices have made palm oil relatively more attractive for buyers.

At the same time, extremely cold weather conditions in Russia have affected sunflower oil exports. Ports are reportedly facing logistical challenges due to freezing conditions, which has slowed supply and impacted global trade flows.

Why Soybean Is Gaining an Edge

Industry experts believe that soybean and soy oil are currently benefiting from a combination of global and domestic factors. Policy announcements from the United States have also contributed to price strength in soy oil markets.

Additionally, soy oil is currently about $100 more expensive than palm oil. Despite this price gap, strong demand and limited supply have kept soybean prices elevated.

India requires nearly 27 million tonnes of edible oil annually to meet domestic consumption needs. With soy oil prices rising, import patterns may shift depending on relative price advantages among different oils.

What Lies Ahead for Prices?

Market analysts suggest that the bullish trend in soy oil may continue in the near term, particularly if:

• Weather disruptions persist in Argentina or Brazil.

• China maintains strong import demand.

• Domestic arrivals remain limited.

However, price sustainability will depend on harvest progress in Brazil and global demand trends. If weather conditions improve and supply normalizes, prices may stabilize.

On the other hand, if crop damage concerns intensify or export demand strengthens further, soybean and soy oil prices could remain firm or move higher.

Key Factors to Watch

Investors and traders should monitor:

• Harvest progress in Brazil

• Weather developments in Argentina

• China’s purchasing activity

• Import trends in India

• Relative price movements between soy oil and palm oil

Conclusion

The recent rally in soybean and soy oil prices reflects tightening supplies and supportive global demand. While palm and sunflower oil prices are under pressure, soybean complex prices remain resilient.

Whether this upward momentum continues will depend largely on weather developments and global trade dynamics. For now, the edible oil market remains active, with soybean leading the current price surge.