China’s decision on US soybeans could weaken palm oil’s competitiveness

global figure is expected to be 29.5%, indicating an oversupply that will weigh on vegetable oil markets. RHB notes that the price differential between palm and soybean oil has narrowed by 55% in the past three weeks to $42 per tonne from $263 in June 2025. A further decline in soybean oil prices could limit palm demand. For example, India switched to soybean oil imports at the beginning of the year, reducing palm oil purchases by 18% in January-August compared to last year. If the price difference remains low, palm oil imports will continue to be limited. Trade tensions between the US and China are exacerbating the situation. US President Donald Trump has announced a possible suspension of trade in used cooking oil with China in response to Beijing’s refusal to buy American soybeans, calling it an “economically hostile act”. According to him, the US can independently meet domestic demand for cooking oil, which adds uncertainty to the global vegetable oil market. At the same time, ...