Insight Focus
Oil and oilseed prices have surged on the US-Iran conflict. Brazil’s soybean exports rebounded despite weather delays, while US exports fell but domestic crush remained strong. China faces oversupply and slowing demand, pressured by incoming Brazilian and US soybeans and weaker economic growth.
Oil and Oilseed Prices Surge Amid US-Iran Conflict
The war in Iran drove Brent Crude oil prices up 42% between February 27 and March 9, as the conflict disrupted Middle East petroleum production and shipments. Futures prices for soybean oil (linked to petroleum through its use in biodiesel) rose 11%, while soybean prices increased 5%.
The widening impact prompted comparisons to the broad-based commodity price surge following Russia’s 2022 invasion of Ukraine.
Similar patterns of rising prices in the oilseed complex were observed on exchanges worldwide. Malaysian palm oil, which is widely used to produce biodiesel, rose 13% between February 27 and March 9. China’s soy complex is caught between rising international vegetable oil prices and downward pressure from the impending arrival of large volumes of Brazilian soybeans in April and May.
Price increases on Chinese exchanges were moderate during the first week of the Iran war but accelerated as petroleum prices surged. By March 9, Chinese palm oil was up 10.1% from February 27, Chinese rapeseed oil rose 8.4%, and imported soybeans gained 6%.
Source: ICE, CME, Dalian and Zhengzhou Commodity Exchange
Brazil Soybean Prices and Exports Rebound Despite Weather Delays
War news overshadowed attention on Brazil’s soybean crop. FOB prices at Brazil’s Paranagua port rose 3.4% during the first week of March, reversing a downward trend in the first two months of 2026.
The harvest was slowed by rainy weather in northern Brazil, particularly in the top-producing state of Matto Grosso. Consultancy AgRural reported that 39% of Brazil’s soybean crop had been harvested by the final week of February, down from 50% a year earlier.
Production in southern regions faced drought-related yield losses, though mid-February rains provided some relief. AgRural and StoneX pared back their estimates of the 2025/26 crop to about 178 million tonnes, while consultancy Agroconsult raised its estimate to 183.1 million tonnes.
Brazil’s soybean export campaign is expected to be at least as large as last year’s. Wet weather, clogged roads, overwhelmed logistics facilities and a protest by activists at a transshipment facility in Brazil’s Amazon region slowed shipments in February. Some beans—damp from the rain—needed drying before being loaded onto vessels.
Based on ship lineups, Brazil’s exporter association ANEC estimated that 8.88 million tonnes of soybeans were exported in February. This was up from 2.4 million tonnes in January but slightly behind the year-earlier volume. More than 70% of February exports were bound for China, with customs data showing 200,000 to 300,000 tonnes shipped to other top destinations including Spain, Thailand, Turkey, Pakistan and Taiwan.
ANEC estimated 16 million tonnes would be exported in March, when Brazilian soybean shipments enter their peak season—about 350,000 tonnes ahead of the same month last year.
Two cranes loading soybeans onto a cargo ship, Brazil
US Soybean Exports Dip While Crush Remains Strong
US soybean exports peaked at 5.9 million tonnes in January and fell to 3.9 million tonnes in February, according to USDA export inspections. Cumulative US exports for the first six months of the 2025/26 market year reached 26.1 million tonnes, 11.6 million tonnes behind the year-earlier pace. Ship lineups project March exports at around 5.2 million tonnes.
Cumulative US soybean exports to China for MY 2025/26 totalled 6.9 million tonnes through February, with ship lineups suggesting an additional 2 million tonnes or more could be exported to China in March.
Note: Crush converted from short tons to metric tonnes. Crush data for February not yet released.
Source: USDA
US soybean crush has been strong in the 2025/26 market year, including a record 6.43 million tonnes in October 2025. January 2026 crush, estimated by USDA, was 6.2 million tonnes—up 6% from a year earlier. The cumulative crush total for the first five months of MY 2025/26 exceeded the year-earlier total by 2.15 million tonnes.
China’s Soybean Market Faces Oversupply
Chinese crushers restarted operations after the mid-February Lunar New Year holiday. Soybean supplies were temporarily tight, but soybean oil and meal inventories remained ample. March is a seasonal low for meal and oil demand.
Other bearish factors include China’s slow economic growth, highlighted by the leadership’s announcement of a 4.5%-to-5% GDP growth target for 2026—the lowest since the early 1990s. Last year’s booming demand for soybean meal could cool in 2026 if Chinese hog producers follow government instructions to reduce herds, a measure intended to revive slumping hog prices.
Source: World Bank
China could face a deluge of soybeans during the spring and summer months. Brazil is likely to export more than 11 million tonnes to China in March, with customs clearance expected in May. US soybean shipments to China would further add to supplies. China’s soybean oil market could also be squeezed by the expected resurgence of Canadian canola, canola oil and meal imports after authorities cut antidumping duties that had reduced shipments over the past year.
Chinese customs officials have warned that more intensive inspections could lengthen clearance times in coming months. Rumours also circulated that border inspectors might reject more Brazilian soybean shipments on phytosanitary grounds.
