Unresolved issues

Too many unresolved issues are hanging over our markets, leaving them in a state of great uncertainty. In general, fundamentally, there haven't been many changes in the past weeks but markets kept reacting up and down to opposing and even contradicting news headlines. And at the same time every evolution seems to be hampered or blocked by overruling uncertainties.

The summary remains the same. The soybean complex is characterized by a past bumper soybean harvest in South America and now a record harvest in the US, a lot of beans facing a boycott of purchases by China. In the rapeseed markets the Chinese boycott of Canadian rapeseed products and an overall much better than initially anticipated global seed supply this season keeps markets moving sideways.

And as for palm, the biodiesel situation in Indonesia, which limits available export volumes, is supportive to palm oil prices. And the much smaller harvests of sunflower seed than initially expected, extinguished all optimism about sun oil, in the end, weighing on the oil market.

Much remains blocked on unresolved trade disputes, slowly changing biodiesel policies, legislative haziness round the EU deforestation laws, geopolitical tensions and the state of te global economy. 

Soybeans are only a minor detail in the broader context of the US – China trade war, where rare earths and economic and political influence or dominance is of greater importance. Soybeans are, so to speak, collateral damage. The legality issue around the US tariffs also remains pending. The US Supreme Court is said to begin reviewing the tariff case on November 5th and the deadline for the trade agreement with China is November 10th. But concerns regarding China eased a bit when Treasury Secretary Bessent recently raised the possibility of a longer tariff truce with China, specifically linked to rare earths, a group of 17 metallic elements with unique properties, essential in various high-tech applications. But a truce is not a solution, it is kicking the can further down the road.

Meanwhile president Trump announced he's "stopping all trade negotiations" with Canada because of a Canadian television ad opposing US tariffs… which he didn't like. He also regularly threatens additional measures if Europe doesn't adjust its climate and digital legislation. Then various political groups in the EU are calling for adjustments (all sorts of additional clauses) to the trade deal with the US, which still needs to be discussed/approved by the EU Parliament. The situation remains highly uncertain and everything could still change.

EUDR

The last months have been confusing with regard to European legislation on deforestation (EUDR). Expectations have constantly changed, with many people wondering whether its implementation would be postponed in whole or in part. After proposing a further postponement, the Commission's latest decision has maintained the effective date of December 30, 2025. However, its proposal to amend the law to address concerns about IT readiness, administrative burden, etc. while preserving the fundamental sustainability goals must still be voted.

The final outcome will impact the prices and trade flows of soybeans, soybean meal, rapeseed meal, and crush margins, as well as on the cost and risks associated with the administrative complexity of production, for example of meat, in the EU. Crush margins will have an impact on edible oil prices. Palm oil imports and prices will also be affected. If the price of palm oil in EU increases and/or if this increases risk and complexity (compliance, traceability, etc.), competing oils could become more attractive.

Petroleum

Oil markets

Palm oil

Soybean oil

Some support came from rumors of (fake)news that President Trump will meet Chinese leader Xi Jinping soon in South Korea on the sidelines of the APEC Summit, to talk about easing trade tensions. It may happen or it may not happen. In any case the export window for US bean exports is closing fast, but US beans are ready to travel. Farmers are storing as much as they can on farm and are reluctant sellers at present prices.

The EPA still has to finalize the 2026 and 2027 'renewable volume obligations for biofuel blending'. So that, soybean oil demand, is also still pending.

Then there is the inflation problem of soaring prices for T-bone steak in the US, where consumers now tend to buy cheaper poultry meat. President Trump had the brilliant idea of buying Argentine beef to "bring down grocery prices for Americans" and support the Argentine economy at the same time. Ranchers were not amused. The US has closed its border to Mexican cattle since May, following an outbreak of the flesh-eating 'new world screwworm' (NWS) parasite. In addition, Brazilian meat is subject to prohibitive tariffs. Today, the administration is pushing to rebuild the decimated US cattle herd (the smallest in 75 years; consolidation, economics, and several droughts forced ranchers to reduce herd size), which should boost consumption of soybean meal and/or whole beans, but rebuilding takes time.

Beans are available in abundance for this season. But next season could hold some surprises. In South America, weather conditions are ideal for planting, but the crop still has months to grow. In the US, farmers may be reluctant to plant soybeans in the spring if soybean prices remain too low for too long, given rising input costs and weak export demand.

In its preliminary estimates on October 14th, the Companhia Nacional de Abastecimento (CONAB) predicted a 3.5% increase in the Brazilian soybean acreage (highest level ever: 121M acres). Weather permitting, production should reach a record 176.9Mmt. A day earlier, the Brazilian Association of Vegetable Oil Industries (Abiove) predicted a crop of 178.5Mmt for 2026, compared to 171.8 in 2025.

South America is nearing end of season and stocks will start to tighten. Nearby price directions, for beans, oil and meal will depend a lot on how the US-China trade relations evolve and on how and when the EUDR is implemented in EU-27.

Rapeseed oil

In 2026, rapeseed oil demand for biodiesel will be impacted by several things. A new proposed German legislation wants to do away with the creative accounting practices of "double counting some feedstocks" for green- house-gas reduction goals. If voted this could trigger more demand for rapeseed oil next year. 

As imports of biodiesel from China into EU-27 have dwindled due to anti-dumping duties in place since February '25 this could also be (partly)compensated by rapeseed oil. The phasing out in some member-states of palm oil could also (partly) be compensated by rapeseed oil. 

But, an increase in UCO (used cooking oil) imports, to replace palm oil in biodiesel production, could weigh on rape oil demand. American ethanol producers are actively looking at EU-27 to export their product that can be blended with gasolene; it is not excluded that US biodiesel producers also export to EU-27 (after August '26 when an anti-dumping duty ends). This depends on the finalization of the trade deal with the US and on de implementation or not of the EUDR (it could complicate a US soybean-based biodiesel trade flow).

In France there have been discussions and proposals to increase the biodiesel blending mandate but also to give less tax incentives for biofuels. Outcome is pending.

EUDR-implementation, or not, will impact the price of rapeseed and meal ("safe haven" amid tightening meal supply) and consequently the crush margin and eventually the price of rapeseed oil. 

A potential better relation between China and Canada, as well as between Canada and the US, could also alter trade flows and change price dynamics.

Then an anticipated lower production of fish oil in Peru and EU could also trigger extra rapeseed oil demand from fish feed producers.

With all these pending issues the situation remains uncertain and confusing.

But overall, the market stayed neutral as seed supply is abundant, crush margins have been good and some crushers have been crushing rape instead of sun, which contributes to a good rape oil supply; although for now, the market remains in an inverse, which could weaken with a somewhat weakening demand outlook.

Sunflower seed oil

The global market remains marked by a deterioration in supply prospects this season, with delayed harvests and farmers very reluctant to sell. This means that harvest pressure to sell, is being pushed away and eased off.

Besides problems in Ukraine and Russia and eastern EU there is also bad news from France. According to the French Ministry of Agriculture, in France, where more than 80% of sunflowers are high oleic acid varieties, the 2025 sunflower harvest is now estimated at 1.46Mmt. This is about 18% lower than the average of 1.77Mmt for the previous five years, mainly due to a decrease in acreage (-12.5%), but also due to a lower yield (-6.1%) of 2.12 mt/ha.

Sunflower seed crush margins are not encouraging the production of oil and sun oil prices in EU have consequently firmed again, instead of easing under a harvest push. At the same time consumers continue to cover their needs on nearby which helps keeping the market in an inverse.

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