About Soybean Oil Prices
Soybean oil is the most widely consumed vegetable oil in the United States and the second most consumed globally after palm oil. It is extracted from soybeans during the crushing process.
Soybean oil prices are quoted in U.S. cents per pound and traded on the Chicago Board of Trade (CBOT). Prices are influenced by biodiesel mandates, palm oil competition, global vegetable oil demand, and the crush spread economics.
The rise of renewable diesel and sustainable aviation fuel (SAF) has created a structural demand shift for soybean oil, pushing prices higher as energy-sector consumption competes with traditional food use.
Soybean Oil Market Overview
Global Production
~60 million tonnes
Top Producer
China (~28%)
Top Exporter
Argentina (~45%)
Biodiesel Share (U.S.)
~40% of soy oil use
Oil per Bushel
~11 lbs soy oil
Share of Crush Value
~35%
Soybean oil has undergone a demand revolution driven by renewable fuels. In the U.S., biodiesel and renewable diesel now consume roughly 40% of soybean oil production, up from ~15% a decade ago. This energy-sector demand has structurally tightened the food-grade soybean oil market and elevated prices.
Soybean Oil Historical Price Milestones
2006 — Pre-biofuel Era
$0.25/lb
2008 — Commodity Boom
$0.72/lb
2014 — Oversupply
$0.30/lb
2021 — Renewable Diesel Boom
$0.73/lb
2022 — Indonesia Palm Ban
$0.89/lb
15-Year CAGR
~5.5%
Soybean oil prices were transformed by the rise of biodiesel (2005–2010) and renewable diesel (2020–present). The 2022 Indonesian palm oil export ban briefly sent all vegetable oil prices to record highs. Long-term, the energy transition toward sustainable aviation fuel could further increase soybean oil demand.
Ways to Invest in Soybean Oil
Futures
CBOT ZL
60,000 lbs per contract
Crush Spread
Board crush trade
Processing margin play
Biodiesel Stocks
REX, REGI
Renewable fuel producers
Agri ETFs
DBA
Broad agriculture exposure
Soybean oil futures provide direct exposure to both food and energy demand dynamics. The growing renewable diesel industry (companies like Diamond Green Diesel, a JV of Valero and Darling Ingredients) creates additional demand tailwinds. The board crush trade allows sophisticated investors to express views on processing margins.
Frequently Asked Questions
How does biodiesel affect soybean oil prices?
Biodiesel and renewable diesel have become major demand drivers for soybean oil, consuming ~40% of U.S. production. Federal mandates (RFS) and state-level programs (California's LCFS) require blending of renewable fuels, creating guaranteed demand that supports higher prices. This has structurally shifted soybean oil from a food commodity to a dual food-energy commodity.
What is the relationship between soybean oil and palm oil?
Soybean oil and palm oil are the two largest vegetable oils globally and are partial substitutes. Palm oil is cheaper, but sustainability concerns and import restrictions have benefited soybean oil demand. When palm oil prices spike (as during the 2022 Indonesian export ban), soybean oil prices rise in sympathy as buyers switch.
What is sustainable aviation fuel (SAF)?
SAF is a renewable jet fuel that can be produced from soybean oil and other feedstocks. Aviation's push to decarbonize (IATA targets net-zero by 2050) could create massive new demand for vegetable oils. If SAF mandates are widely adopted, soybean oil demand could increase by 5–10 million tonnes annually, fundamentally reshaping the market.
How is soybean oil priced relative to meal?
Soybean oil represents roughly 35% of the total crush value, while soybean meal represents 65%. When oil demand is strong (as during biodiesel booms), the 'oil share' of crush value increases, incentivizing more crushing and potentially depressing meal prices. This interplay is captured in the 'reverse crush' or oil-weighted crush spread.