Brazil’s soybean oil production could reach 13.5 mln tons, while exports decline

Brazil’s soybean oil production could reach 13.5 mln tons in the MY 2026/27, supported by increased soybean crushing and growing demand from the biofuel industry. Meanwhile, soybean oil exports are forecast by FAS USDA to decline by 15% to 1.7 mln tons, compared with 2 mln tons in the current season. The reduction in overseas shipments is expected amid rising domestic consumption, particularly due to the planned increase in the mandatory biodiesel blending rate to 16% in 2027.

According to USDA, international demand for Brazilian soybean oil increased by more than 50% in 2026, supporting the development of the country’s processing industry. Another important factor will be the introduction of the B16 blending mandate, which is expected to significantly increase soybean oil consumption for biodiesel production. However, rising domestic demand is likely to limit the volumes available for export, even as production expands.

Brazil’s soybean crush is forecast at 65 mln tons in 2026/27, up 2.3% from the previous estimate. Growth will be supported by ample soybean supplies, steady demand for soybean meal and oil, and more favorable conditions for domestic processing. Meanwhile, soybean production could reach a record 184 mln tons, marking the country’s third consecutive record harvest. Planted area is projected at 49.7 mln ha, with an average yield of 3.7 t/ha.

Despite increasing production, the pace of soybean acreage expansion in Brazil is slowing. In 2026/27, planted area is expected to increase by just 1.4% year on year, compared with an average annual growth rate of 4.2% over the past five years. High interest rates, economic uncertainty and rising input costs remain the main constraints. According to USDA, soybean production costs are projected to increase by 6.6%, primarily due to higher fertilizer and crop protection chemical expenses.

Brazil’s soybean exports could rise to 117.5 mln tons in 2026/27, compared with 115 mln tons in the current season. China will remain the main buyer, although Brazilian shipments to the Chinese market declined by 3.6% in January–September 2026 compared with the same period last year. Further expansion of domestic crushing and demand for soybean oil from the biofuel sector could intensify competition between export markets and domestic soybean use.

Tags: soybean oil, Brazil