US Soy Oil Exports Soar 91 Percent as Trade War Turmoil Rocks Global Oilseed Market

Despite rising tensions from the U.S.–China trade conflict, the global oilseed market staged a sharp rebound in the week ending April 11, with Chicago soybean futures climbing back above $10 per bushel. A weakening U.S. dollar, tightening U.S. soybean supplies, and rising global crush demand combined to fuel the surge. Meanwhile, Trump’s aggressive tariff hikes triggered immediate retaliation from China, sending shockwaves through agricultural trade flows.

As of Friday, May soybeans on the CBOT closed at $10.4275/bushel, up 6.7% from the previous week. Gulf soybean spot prices for April averaged $11.1175, while soymeal and soyoil futures rose by 5.8% and 3.3% respectively. In the background, the ICE U.S. Dollar Index plunged to a three-year low of 99.892, down 1.3%, further boosting dollar-denominated commodity prices.

Trump’s trade policies, reinstated with a vengeance in his second term, now include a 145% tariff on Chinese imports and a 10% universal tariff on all others. In retaliation, China imposed a 125% tariff on U.S. goods, effectively pricing American soybeans out of the Chinese market. Chinese buyers snapped up over 60 cargoes of Brazilian soybeans this week alone, the highest for the season, helping push Brazil’s forward sales above half of expected production.

USDA’s April report adjusted the 2024/25 soybean crush forecast up to 2.42 billion bushels, and trimmed ending stocks to 375 million bushels. While the average farm price remains unchanged at $9.95, it reflects a marked drop from last year’s $12.40. Globally, increased crush activity in Brazil, Argentina, and the U.S. pushed global crush estimates to 354.84 million tons, while ending stocks rose to 122.47 million tons, up 5.9% year over year.

One standout was U.S. soyoil exports, which are benefiting from an unusual discount versus palm oil. The USDA raised the export forecast to 2.3 billion pounds, or 1.04 million tons, up from 816,000 tons in March. Actual sales to date have reached 945,000 tons, a massive 91% increase from last year’s 88,000 tons. With Brazil using more soyoil for domestic biodiesel and trimming export forecasts, the U.S. has seized the opportunity.

However, uncertainty around U.S. renewable fuel subsidies has capped biodiesel-sector demand, prompting the USDA to cut industrial soyoil use by 200 million pounds. A recent industry proposal to the EPA to raise 2026 biomass diesel mandates to 5.25 billion gallons could shift that dynamic, but for now, stockpiles are dwindling. U.S. soyoil ending stocks are now projected at 1.451 billion pounds, a 12-year low, with a record-low stocks-to-use ratio of 4.9%.

Rapeseed wasn’t immune to volatility either. Global output was lowered to 85.24 million tons, a 5.1% drop from last year. The EU and India saw notable downward revisions, although Canadian production was held at a strong 18.8 million tons.

Despite a 13.6% rise in total U.S. soybean sales for 2024/25 so far, weekly net sales fell 58% in early April, suggesting future exports may slow. Brazil remains the world’s cheapest source of soybeans, with the price gap to U.S. Gulf narrowing to $5 per ton. On April 10, Brazilian soybeans were quoted at $404/ton, still below U.S. Gulf prices of $409.

In South America, Brazil’s harvest hit 85% and output was revised up to a record 167.87 million tons. Soy exports are surging, with 13.3 million tons expected this month alone. Meanwhile, Argentina’s harvest progress is only at 3%, slowed by heavy rains. Farmers are holding back sales amid expectations of currency devaluation and tax changes.

With spring planting underway in the Northern Hemisphere, all eyes turn to U.S. weather and planting intentions. Analysts expect U.S. soybean acreage to shrink by 4%, and China’s steep tariffs could drive further reductions. As one market observer put it, “Whether the tariff is 125% or 1250%, it makes no difference—U.S. soybeans are out of the game.”

Going forward, any signal of U.S.–China negotiations could become a bullish surprise, particularly as reduced planting prospects meet tightening global supply. The market has priced in the trade war—but a shift in policy could spark a sharp reversal.