Indian importers have committed to buy more than 150,000 metric tons of South American soybean oil each month from April to July 2025, fearing tighter supplies of palm and sunflower oils in 2026.

Large organizations reported that concerns over Indonesia’s B50 mandate and land seizures, which could tighten palm oil supply, have pushed major importers to secure more soy oil in advance.

Buying has also been driven by concerns around tight sunflower oil supply.

Price impact across vegetable oil markets

CBOT soy oil jumped to 52.36 cents per pound from 50.52 cents per pound at the same time last week. FOB Argentina crude soy oil price increased to $1,125 per metric ton from $1,081 per metric ton at the same time last week.

The buying activity is supporting prices across the vegetable oils complex. BMD Crude Palm Oil price increased to $982 per metric ton from $976 per metric ton at the same time last week, with strong growth in rival oil prices providing support.

JFM price for crude sunflower oil increased to $1,355 per metric ton from $1,330 per metric ton in the same period last week. FMA crude rapeseed oil increased to €1,083 per metric ton from €1,070 per metric ton at the same time last week.

China faces oversupply situation

Meanwhile, China is facing growing oversupply. OilWorld reported that China contracted around 200,000 metric tons of soy oil for export in October to December, compared with 60,000 metric tons during the same period last year.

In other news, China said it will stop purchasing soybeans from several Brazilian suppliers due to sanitary concerns. This includes two facilities owned by Cargill, as well as plants operated by LDC, CHS Agronegocios, and 3Tentos Agroindustrial.

Supply concerns driving forward purchases

The Indian buying reflects concerns about multiple supply factors converging in 2026. Indonesia’s planned B50 biodiesel mandate would require greater domestic palm oil consumption, potentially reducing export availability. Land seizure issues in Indonesia add further uncertainty to palm oil supply.

Sunflower oil supplies face their own constraints. Ukraine’s largest agroholding, Kernel, said the gap between crushing capacity and the sunflower harvest in Ukraine will be around 10 million metric tons, which will lead to fierce competition for seeds and put pressure on margins.

Kernel estimates Ukrainian sunflower production, including the grey market, at 11.4 million metric tons, while local analytical houses estimate around 11 million metric tons.

Some market experts say that a large area in Russia may not be harvested due to early snowfall, adding further uncertainty to sunflower oil availability.

Market outlook

In the short term, the market may move sideways or slightly higher due to strong demand and tight Argentine stocks. Recent news of large soy oil purchases by India should support prices. Seasonally slower palm oil production during November to February is expected to provide additional support.

Policy updates will play a key role, particularly regarding the timeline for U.S. biofuel regulations and the potential reallocation of small refinery exemptions. In the longer term, sentiment remains bullish, supported by higher U.S. and Brazilian biofuel mandates that are expected to boost domestic soybean oil demand.

Additionally, the U.S. may restrict biodiesel credits for imported feedstocks such as tallow and UCO, which could further tighten the domestic market.

This newsarticle is part of a more comprehensive market vegetable oil market analysis. For the full analysis, visit: https://app.vespertool.com/market-analysis/2493?commodity=vegetable-oil