Soybean Oil and Canola Prices Rise Amid US-China Trade Threats
US President Trump announced the possibility of suspending imports of processed vegetable oil from China if Beijing does not resume purchases of American soybeans. This statement impacted the market, supporting prices for soybean oil and canola.
This is reported by AgroReview
Trade Tensions and Their Impact on Oilseed Markets
Used cooking oil (UCO) — a raw material collected after use in the food industry — is most commonly used for biofuel production. Earlier this year, the Trump administration already halved subsidies for biofuel production from imported processed oil from China and canola oil from Canada. This stimulated the use of oils of American origin in biofuel production.
“US President Trump continues to seek leverage against China in the trade war, stating on Tuesday that Washington is considering halting purchases of processed vegetable oil from China if it does not resume buying American soybeans. This has provided support for the exchange quotes of soybean oil and canola.”
Export Dynamics and Quotes
In 2024, China exported a record 1.27 million tons of processed vegetable oil to the US, worth $1.2 billion. However, after the cancellation of tax incentives for exports starting December 1, 2024, the volumes of shipments decreased by 43% in the first seven months of 2025, amounting to only about 387,000 tons.
At the Chicago Mercantile Exchange, December futures for soybean oil rose by 0.9% to $1,120 per ton, but remained 1.4% lower for the week and 4.3% lower for the month. The increase in quotes was not significant, despite Trump’s statements and data on increased soybean processing in the US.
According to the NOPA association, soybean processing in the US in September 2025 reached 5.385 million tons, which is 4.3% higher than in August and 11.6% above the figures for September 2024. This indicates a growing demand from the biofuel industry.
In the North American market, November futures for canola increased by 2% over two sessions to 620 Canadian dollars per ton ($442), which is 0.5% higher for the week but 3.2% lower for the month. The rise in quotes is linked to both Trump’s statements and the announcement by the Chinese ambassador to Canada regarding Beijing’s readiness to lift the ban on canola imports if Canada drops tariffs on Chinese electric vehicles.
Relations between the US and China remain tense, particularly over issues of tariffs, technology, human rights, as well as situations surrounding Hong Kong, Taiwan, and Ukraine. Market participants do not expect a quick resolution to trade disputes and a significant resumption of American soybean exports to China. At the same time, China may resume canola imports from Canada, partially replacing its soybean needs with it.