Soy oil jumps as India agrees to cut duties on US imports

Soybean oil prices climbed to their highest level in more than six months amid expectations that India will boost purchases after agreeing to cut or eliminate import duties on US agricultural products.

The most actively traded soybean oil futures on the Chicago Board of Trade rose as much as 2.2% on Monday, reaching their highest levels since July. The rally followed a framework trade agreement between India and the United States that would open parts of India’s agriculture market to cheaper US supplies.

India is the world’s largest edible oil importer, buying around 16 million tons of palm, soy and sunflower oil annually. However, US soy oil shipments remain relatively small, totaling about 200,000 tons during January–November last year.

Analysts say the deal could allow US exporters to gain market share from other major suppliers and curb demand for competing edible oils. Still, further price gains may be limited by strong soybean yields in Brazil and an accelerating harvest pace.

Additional support came from recent updates to US biodiesel tax credits, which favor feedstocks sourced in North America. Meanwhile, soybean meal prices fell nearly 2%, while the USDA reported fresh US soybean export sales to China.

Tags: prices, India, USA, duties, soybean oil