Benchmark soybean oil futures in Chicago rose to a two-year high, supported by stronger energy prices, optimism around the US biofuel blending mandate and improving business sentiment.
India, the world’s biggest soybean oil buyer, canceled several more cargoes from South America due to a rise in international prices, giving traders an opportunity to book profits.
Ashish Acharya, vice president of Patanjali Foods Ltd., one of India’s top vegetable oil buyers, said about 65,000 to 75,000 tonnes booked by Indian traders for April to July have been canceled in recent days. The move involves buyers canceling cargoes and effectively selling them back to the supplier at a higher price, making a profit of about $40 to $60 a tonne, Acharya said.
He said the amount of so-called washed soybean oil could reach about 100,000 to 120,000 tons in the coming days. Several other vegetable oil traders confirmed Bloomberg’s moves.
Benchmark soybean oil futures in Chicago rose to their highest in more than two years amid stronger energy prices, Washington’s trade deal with India and optimism that U.S. biofuel blending quotas will support demand. The cargo cancellations come as Indian buyers have ample soybean oil and are expecting a potentially record South American crop to increase supplies around April.
“Buyers who had earlier bought the contracts at lower prices around $1,080 to $1,100 a tonne are now exiting those positions as prices have risen to $1,140 to $1,147.50,” Acharya said. He said as the market prepares for larger South American supply, there will be more “in and out” trading.
When buyers decide not to take delivery of cargo, sellers generally will not be required to obtain physical supplies and bear the associated costs. Canceling shipments now also could reduce the risk Indian traders face in selling oil locally at the end of the year, when new South American supplies could weigh on the market.
India has already canceled soybean oil cargo. Earlier this year, it withdrew at least 35,000 to 40,000 tonnes of imports from Brazil and Argentina as the rupee’s depreciation made imports more expensive and uneconomic. This followed the cancellation or delay of more than 100,000 tonnes of Argentinian deals in December.
A bumper crop of South American soya is expected to hit the market between April and July, which is likely to push prices lower, said Gnanasekar Thiagarajan, head of trading and hedging strategies at Kalisuvari Intercontinental. That’s why the recent rise in US soy oil futures – which sets the direction for physical prices – has driven the decline, he said.
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Published on February 26, 2026
