Mexico’s Soybean Market: Rising Demand, Heavy Import Dependence

Mexico’s soybean market is tightening moderately as domestic crush and livestock demand grow faster than local production, keeping imports high but stable and stocks comfortable.

Mexico’s upgraded 2026 GDP outlook and expanding livestock and food-processing sectors are driving structural growth in soybean, meal, and oil use. Domestic soybean production is recovering but still covers only a small fraction of consumption, leaving Mexico heavily reliant on competitively priced U.S. and Brazilian supplies. Strong crush margins, higher carryover stocks, and robust feed and vegetable oil demand underpin a gradual expansion of crushing volumes through MY 2026/27. Internationally, soybean futures have firmed in early April alongside higher energy prices, adding a mild bullish tone to import costs.

📈 Prices & International Context

Global soybean prices have firmed in late March and early April. CBOT soybean futures rose this week in response to higher crude oil prices and renewed geopolitical risk around Iran sanctions, with grains and oilseeds generally supported by the energy rally and fund short-covering.

Physical offers in key origins indicate relatively competitive spot values in euro terms. Converting recent FOB quotes (approx. 1 USD ≈ 0.93 EUR), benchmark soybeans stand around EUR 0.55–0.65/kg for standard U.S. and Chinese supplies, and close to EUR 0.92–0.95/kg for higher-grade Indian beans. This leaves Mexico’s crushers and feeders facing slightly higher but still historically moderate raw-material costs, with import parity cushioned by efficient rail and Gulf port logistics from North America.

🌍 Supply & Demand in Mexico

Mexico’s central bank has lifted the 2026 growth forecast to 1.6%, with stronger domestic consumption and exports supporting food and feed demand. Soybeans and derived products are central to this trend: oilseed demand is expected to keep rising as population and livestock herds expand, while domestic oilseed production remains structurally constrained by land, water, and financing limits. In MY 2026/27, total oilseed production is forecast at 640,000 MT, only about 6% of total use, underscoring the country’s dependence on imports.

For soybeans specifically, MY 2026/27 production is forecast at 315,000 MT, about 3% above the 10-year average but still covering only roughly 4% of total soybean consumption. Planted area is edging higher, and yields in key states such as Tamaulipas and Campeche have improved on better moisture, but structural bottlenecks – limited access to improved seed, farmer preference for basic grains, and reduced policy support – cap growth. Domestic soybeans therefore play a niche role relative to crushing demand.

On the demand side, soybean consumption in MY 2026/27 is set to reach about 7.0 MMT (+2% year-on-year), driven almost entirely by crush for meal and oil. Installed crush capacity is around 11.5 MMT, with utilization near 60%, leaving considerable headroom. Over 80% of this capacity is configured for soybean processing, and major processors have modernized plants and consolidated operations, supporting stable margins and the ability to absorb higher imports and carryover stocks.

📊 Trade Flows & Fundamentals

Soybean imports are the cornerstone of Mexico’s supply balance. In MY 2026/27, imports are forecast stable at 6.7 MMT, after a 4% increase the previous season. This stability masks a gradual shift in origin: U.S. beans still account for around three-quarters of the import market (2023–2025 average), but Brazil’s share has risen as crushers blend Brazilian beans for higher protein content, particularly during Brazil’s peak export windows in March and September.

Logistics are a key strength. Around 70% of U.S. soybeans arrive by rail directly to crushing plants, with Nuevo Laredo and Piedras Negras handling more than 80% of rail volumes. The remaining imports move by vessel to Gulf ports, especially Veracruz and Puerto Progreso, allowing rapid two-day shipments from U.S. loading points. This multimodal set-up limits basis volatility and supports just-in-time supply for crushers and feed manufacturers.

Crush is forecast at nearly 7.0 MMT in MY 2026/27 (+2%), supported by high carryover stocks from 2025/26 and strong downstream demand. Soybean ending stocks are projected to ease slightly from 711,000 MT to 691,000 MT as the industry draws down inventories to meet rising meal and oil demand. Meal extraction rates hover around 79%, and oil yields near 18.5%, with hulls and lecithin contributing to feed applications.

🐓 Feed, Meal & Livestock Dynamics

Soybean meal remains the backbone of Mexico’s feed complex. Total oilseed meal production is forecast at 6.3 MMT in MY 2026/27 (+2%), while meal imports are expected to reach about 2.7 MMT (+4%), leaving total meal use around 9.0 MMT. Soybean meal alone accounts for roughly 78–80% of total meal consumption and around 19% of compound feed formulations, far ahead of rapeseed meal, palm kernel meal, and DDGS.

In MY 2026/27, soybean meal production is forecast to rise to about 5.5 MMT, with imports at 2.7 MMT. Domestic and imported soybean meal are both cost-competitive against alternatives, and an average crude protein content of around 46% with a favorable amino acid profile keeps soymeal central to rations. The poultry sector dominates usage, taking about 55% of total soybean meal, followed by swine, dairy and beef cattle, aquaculture, and pet food.

Livestock fundamentals are supportive: Mexico is the world’s fifth-largest compound feed producer, and total feed output reached about 41.8 MMT in 2025, with further modest growth expected. Industry projections point to egg production growth of roughly 2.8% and broiler meat output up about 3.6% in 2026, both of which require incremental soybean meal volumes. As a result, soybean meal consumption is forecast to climb to 8.2 MMT in MY 2026/27 (+4%), reducing room for DDGS and other substitutes despite competitive pricing.

🛢️ Vegetable Oil Demand & Soybean Oil Role

Vegetable oil demand is another critical pillar of soybean fundamentals. Total vegetable oil consumption is forecast at 3.5 MMT in MY 2026/27 (+4%), supported by population growth, expanding food processing, and a vibrant hotel, restaurant, and institutional (HRI) sector. Mexico ranks among the world’s largest vegetable oil markets, with industrial users accounting for about 60% of demand and households the remaining 40%.

Soybean oil is expected to remain the leading edible oil, with roughly 40% of total consumption and about 55% of domestic oil production. In MY 2026/27, soybean oil production is forecast near 1.3 MMT (+2%), while imports decline to around 180,000 MT as higher crush boosts local availability. Soybean oil is prized for price competitiveness, high linoleic acid content, neutral flavor, and its suitability as a base for blended oils, as well as for hydrogenation and interesterification in processed foods.

Consumption of soybean oil is projected to rise to about 1.44 MMT (+4%), driven chiefly by the snack foods, mayonnaise, salad dressing, margarine, and broader processed food segments. Small but growing volumes are also used in feed to increase energy density and pellet quality. Mexico does not have a sizable biodiesel sector, so vegetable oils are not significantly diverted into biofuel, keeping food and feed as the dominant demand channels.

🌦️ Weather & Short-Term Outlook (Mexico)

Weather conditions in early April 2026 are seasonally warm in major soybean areas such as Tamaulipas and Campeche. Short-range forecasts for Tamaulipas point to high daytime temperatures around 26–28 °C with moderate chances of showers around April 3–5, which are broadly supportive for soil moisture without posing immediate flood risk.

Given that the 2025/26 spring–summer soybean harvest is now virtually complete and represents about 95% of annual production, near-term weather has limited impact on the just-finished crop but will be relevant for soil moisture ahead of the next planting cycle. Longer-term risks remain tied to recurrent heat waves and potential tropical storm activity later in the year, which could affect logistics and local yields but are not yet in play for the current marketing outlook.

📉 Risk Factors & Market Drivers

• Geopolitics & energy: Renewed tensions in the Middle East have pushed crude oil higher, lifting oilseed and vegetable oil futures via higher logistics and biodiesel-linked sentiment.
• Currency & freight: Any depreciation of the Mexican peso against the U.S. dollar or further adjustments in freight rates to Mexican ports would raise import costs, given Mexico’s heavy reliance on foreign soybeans and meal.
• Competing origins: Increased Brazilian soybean availability and quality (higher protein) will continue to challenge U.S. dominance and may influence Mexico’s blending strategies and basis levels.
• Domestic policy: Tariff changes (e.g., the 5% import duty on soybean oil from non-FTA partners through end-2026) and any new support or restrictions on oilseed production and imports could alter crush economics.

📆 Short-Term Trading Outlook (3–10 days)

• Importers & crushers (Mexico): Maintain a moderately long coverage stance for Q2–Q3 2026, using current price strength to lock in basis where rail logistics from the U.S. remain smooth. Consider staggered purchases to manage upside risk from geopolitics while avoiding over-hedging if global supplies remain ample.
• Feed manufacturers: Favor soybean meal over DDGS where logistics and inclusion rates allow; current and forecast meal imports plus higher domestic crush provide strong availability, and soymeal’s protein profile remains superior for poultry and swine.
• Producers/exporters (U.S., Brazil): For sales into Mexico, retain some pricing flexibility and watch CBOT and energy-led rallies for opportunities to scale up hedged forward sales, as Mexico’s structural import needs and stable crush outlook offer a resilient demand base.

📍 3-Day Price Indications & Direction (EUR)

Market	Product	Current Indicative Level (FOB/CIF)	3-Day Direction (MX Focus)
CBOT (reference)	Soybeans futures	≈ EUR 4.0–4.2/bu equivalent	Mildly upward on energy/geopolitics
U.S. Gulf / rail to MX	Soybeans No. 2 (FOB)	≈ EUR 0.55–0.60/kg	Slightly firm; demand and energy supportive
N. Brazil / Gulf to MX	Soybeans export grade	≈ EUR 0.54–0.58/kg	Stable to firm; protein premium maintained
MX domestic (delivered feed plants)	Soybean meal	≈ EUR 0.38–0.42/kg	Stable; strong availability, solid demand