USDA raises Brazil soybean oil exports, cuts regional stocks

The US Department of Agriculture raised its forecast for Brazilian soybean oil exports and lowered ending-stock estimates for both Brazil and Argentina in its November World Agricultural Supply and Demand Estimates report, published Nov. 10.

The USDA increased its forecast for Brazilian soybean oil exports in the 2026-27 marketing year to 1.9 million metric tons from 1.7 million mt in the October report. Brazilian ending stocks were reduced by 200,000 mt to 260,000 mt.

Brazilian soybean oil production remained forecast at 13.27 million mt, while domestic consumption was unchanged at 11.4 million mt. Beginning stocks were revised marginally higher to 200,000 mt from 190,000 mt.

For Argentina, the USDA maintained its soybean oil production forecast at 8.68 million mt, domestic consumption at 1.99 million mt and exports at 6.75 million mt.

Argentine ending stocks were lowered to 330,000 mt from 400,000 mt, reflecting a reduction in beginning stocks to 250,000 mt from 320,000 mt. The unchanged export forecast reinforced Argentina's position as the largest soybean oil exporter among the principal producing countries covered by the USDA balance sheet.

The combined ending stocks of Argentina and Brazil were projected at 590,000 mt, down 270,000 mt from the October estimate of 860,000 mt. However, aggregate production across the two origins remained unchanged at 21.95 million mt.

Against the updated supply-and-demand backdrop, South American soybean oil FOB prices increased Nov. 11 as gains in Chicago Board of Trade soybean oil futures outweighed sharply weaker export basis levels.

The CBOT December soybean oil futures contract settled at 63.88 cents/lb, up 1.11 cents, or 1.77%, from Nov. 10.

Platts, part of S&P Global Energy, assessed Argentine soybean oil FOB Up River for December loading at $1,181.24/mt Nov. 11, up $2.43/mt. The basis weakened 100 points to minus 1,030 points against CBOT December futures, absorbing most of the increase in the underlying contract.

Brazilian soybean oil FOB Paranaguá for December loading was assessed at $1,187.85/mt, up $4.63/mt. The basis declined 90 points to minus 1,000 points against CBOT December futures.

Brazil's December-loading soybean oil was assessed at a $6.61/mt premium to Argentina, widening from $4.41/mt Nov. 10.

The Nov. 11 assessments showed that weaker regional export differentials limited the transmission of the CBOT rally into South American flat prices, despite the USDA's lower projected ending stocks.