China’s Buying Spree Lifts Soybeans as Oilseeds Track Crude Higher

Chinese-led demand has sharply improved sentiment in the soybean complex, with export sales to China surging and oilseeds additionally supported by higher energy markets. At the same time, Brazil is preparing for record soybean processing in 2027, hinting at a structural shift toward more domestic crush and relatively tighter export availability. Robust U.S. export data, renewed Chinese interest in oilseeds and escalating crude oil prices are pulling soybean and vegetable oil markets off recent lows. China dominated the latest U.S. weekly soybean sales, while also booking sizeable forward rapeseed volumes from Australia for 2027, signaling confidence in long‑term crushing margins. Parallel moves in Brent crude and Malaysian palm oil underline how energy and vegoil markets are reinforcing each other. In Brazil, rising biodiesel demand and plans to raise the blend mandate are set to push crush to fresh records and cap export growth from 2027 onward.

Prices

CBOT soybean futures rebounded toward recent highs after touching a two‑month low on October 21, helped by the strongest U.S. weekly export sales of the season.   Higher crude oil and palm oil prices added further support to oilseed and vegoil values. Brent crude climbed to 113.05 USD per barrel on Thursday, marking a five‑month high amid heightened tensions between Saudi Arabia and Houthi forces, which improved the relative appeal of crop-based biofuels.

Physical soybean indications in our panel remain broadly stable to slightly firmer. Standard soybeans FOB Odesa, Ukraine are quoted at 0.333 EUR/kg FOB, unchanged from the previous assessment on October 23, 2026, while GMO-free soybeans CPT Odesa trade at 0.396 EUR/kg, down modestly from 0.401 EUR/kg on October 21, 2026. Chinese yellow soybeans stand at 0.74 EUR/kg FOB Beijing, with organic lots at 0.85 EUR/kg FOB Beijing, both steady in recent days.

Supply & Demand

Demand momentum is currently centered on China. According to the latest USDA weekly export report for the week ending October 15, total U.S. soybean net sales reached 2.841 million tonnes, more than four times the prior week and nearly double last year’s level for the same period. China accounted for 2.179 million tonnes of these sales, placing volumes at the upper end of market expectations between 1.8 and 3.0 million tonnes.  Additional daily announcements this week bring total reported U.S. soybean sales via the daily system to 1.488 million tonnes, of which 1.062 million tonnes are destined for China, underscoring sustained short-term import appetite.

Beyond soybeans, China is also securing alternative oilseed supplies. State and private buyers recently booked 15 Panamax cargoes of Australian rapeseed, totaling around 1 million tonnes, for delivery in early 2027 at about 695–705 USD (roughly 620–629 EUR) per tonne C&F China. These purchases reflect attractive crushing margins, lower freight costs versus Canadian origin and improved Sino-Australian trade relations, aided by lower standard tariffs of 9% on Australian rapeseed compared with an effective 14.9% on Canadian supplies.

On the supply side, Brazil is gradually shifting its balance toward more domestic processing. The oilseed crushers’ association Abiove projects Brazilian soybean exports in 2027 to edge down by 0.8% to 113 million tonnes as a larger share of the crop is diverted to local crush. Abiove expects processing to rise by 3.8% to a record 66 million tonnes in 2027, driven primarily by biodiesel demand and the assumption that the national biodiesel blend will increase by one percentage point to 16% in March 2027. 

Fundamentals & External Drivers

Energy markets are providing an important tailwind for soybeans via the vegoil and biofuel channel. Brent crude at 113.05 USD per barrel reflects geopolitical risk premia following repeated Houthi attacks on Saudi oil infrastructure, ports and airports. Nevertheless, exports through the Strait of Hormuz continue, with October flows estimated between 15.4 and 16.7 million barrels per day, approaching the pre-war level of roughly 19 million barrels per day. This combination of higher flat prices but resilient flows supports refining margins and, by extension, demand for biodiesel feedstocks.

Vegetable oils are responding accordingly. Malaysian palm oil futures for the January contract on Bursa Malaysia rose by 26 ringgit, or 0.55%, to 4,793 ringgit (1,048 EUR) per tonne, supported by stronger soyoil prices in Dalian and Chicago alongside higher crude. The tight correlation between palm oil, soyoil and crude suggests that any renewed leg higher in energy prices would quickly feed through to oilseed complex pricing, even as meal remains more closely tied to livestock feed demand.

Weather is another key fundamental in the making. In Brazil’s Center-West region, the rainy season is consolidating but precipitation patterns remain irregular, with high temperatures and limited soil moisture in parts of Mato Grosso and Goiás requiring cautious planting strategies. National meteorological guidance indicates that rainfall should gradually improve into mid- to late-October, helping stabilize establishment of the 2026/27 soybean crop.  While conditions are not yet ideal everywhere, no major production shock is visible at this stage.

Structurally, Brazil’s move to a higher B16 biodiesel mandate from March 2027 is set to underpin sustained growth in soybean oil use, tightening the balance for oil relative to meal.  Abiove expects revenues from Brazil’s soybean complex – grain, meal and oil – to hit a record 69.3 billion USD in 2027, up from 60.3 billion USD this year, primarily on higher prices rather than volumes.

Trading Outlook

• Short-term bias: With U.S. export sales to China exceptionally strong and crude at a five-month high, the near-term price bias for soybeans is moderately bullish, especially for nearby positions.
• End-user strategy: Feed compounders and crushers should consider extending coverage on dips, particularly for late Q4 2026 and Q1 2027, given the combination of strong Chinese demand and supportive energy markets.
• Producer strategy: Farmers in the U.S. and Ukraine may use the current rebound to forward sell a portion of expected production, while keeping some upside exposure in case energy or weather risks intensify later in the season.
• Spread & crush plays: The projected expansion of Brazilian crush and rising biodiesel demand argue for a constructive stance on soyoil versus meal over the medium term, though short-term volatility will track policy headlines and crude.

3‑Day Regional Price Indication

*Directional outlook based on futures, demand signals and freight; not a price forecast.