Soybean Oil Holds Range as Biofuel Demand, Chinese Buying and Energy Risks Support Prices

Today Markets Analysis: Soybean oil remains firmly supported by a combination of strong biofuel demand, elevated crude oil prices and renewed Chinese buying of US soybeans. At the same time, the market remains technically trapped within a well-defined range, leaving traders focused on whether buyers can eventually reclaim the 73.5 area or whether sellers regain control below 65.

The broader soy complex continues to take direction from developments across energy, agricultural and global trade markets. Crude oil has remained elevated amid the continuing conflict involving Iran and disruption risks around the Strait of Hormuz, while Indonesia’s move toward a B50 palm oil biodiesel blend is reinforcing demand across competing vegetable oils.

China has also emerged as an important demand driver, with roughly 1 million metric tons of US soybeans reportedly purchased during the week. Cumulative 2026 purchases are moving toward approximately half of the country’s 25 million-ton annual commitment, ahead of President Xi Jinping’s planned September 24 visit to Washington.

US soybean crop conditions have meanwhile remained steady, with 58% of the crop rated good to excellent.

Biofuel Policy Continues to Support Soybean Oil

The energy complex remains an important fundamental driver for soybean oil. With crude oil trading at elevated levels, biodiesel and renewable diesel feedstock demand remains a key source of underlying support.

The EPA’s Renewable Fuel Standard rule, finalized on March 27, 2026, established record biomass-based diesel volumes of 5.4 billion gallons for 2026. That policy backdrop helped drive a substantial rally in soybean oil during the first half of the year.

Indonesia’s progression toward a B50 biodiesel blend adds another layer of support to vegetable oil demand, particularly as soybean oil competes with palm oil and other feedstocks in the global biofuel market.

Energy markets therefore remain an important component of the soybean oil outlook, with developments closely monitored across the commodities complex by Today Markets and Currency Hedger.

What the Market Has Done

Soybean oil staged a powerful advance from the 50 area to 65 (Daily Level 4) between December 2025 and March 2026.

The rally coincided with increasing expectations surrounding the EPA’s Renewable Fuel Standard and ultimately pushed the market through 65, a major daily resistance level that had been relevant since 2023.

From there:

• The market encountered responsive sellers around 70 and consolidated between 65 and 70 into mid-April.
• Buyers subsequently regained control, pushing prices above 70 and continuing higher into May.
• The advance reached the 73.5 area (Daily Level 3), where buyers initially managed to hold prices.
• The market then extended the rally toward 80 (Daily Level 2) in June.
• The move above 80 was rejected sharply, returning the market toward 73.5.
• Buyers ultimately lost control at 73.5, resulting in a move back toward 65 (Daily Level 4).
• At 65, buyers again stepped in and successfully defended the level.
• Since then, the market has developed a two-way consolidation between 65 and 73.5, defined as Range 1.
• Throughout the consolidation, buyers have continued to defend the yearly VWAP.

The result is a market caught between established technical boundaries, with neither side yet able to generate sustained acceptance outside the range.

Key Levels for the Coming Weeks

The primary levels to monitor are 73.5 (Daily Level 3) on the upside and 65 (Daily Level 4) on the downside.

These levels represent the current battle lines between buyers and sellers and should provide the clearest indication of the market’s next directional move.

Neutral Scenario

If sellers continue to defend 73.5, soybean oil could rotate back toward 65, where buyers have demonstrated a willingness to defend prices.

That would maintain the existing two-way consolidation within Range 1.

A relatively muted outcome from the Trump-Xi summit, combined with crude oil remaining elevated but failing to extend significantly higher, could help preserve this range-bound environment.

Bullish Scenario

A decisive break and acceptance above 73.5 would strengthen the technical outlook and potentially open the way toward 80 (Daily Level 2).

The 80 area is likely to attract responsive sellers again. However, sustained acceptance above 80 would shift attention toward 85 (Daily Level 1), a significant level dating back to 2022.

From a fundamental perspective, a larger-than-expected Chinese purchase announcement following the September 24 Washington summit could provide a catalyst for the bullish scenario.

Further escalation of the Iran conflict, particularly if it pushes crude oil materially higher, could also increase demand expectations for biodiesel feedstocks and strengthen soybean oil.

Bearish Scenario

The bearish setup would become more compelling if buyers fail to defend 65 and the market establishes acceptance below that level.

A sustained break lower could expose 60, followed by 56.5 (Daily Level 5), a significant level from 2025.

Potential catalysts include a sudden ceasefire or meaningful de-escalation in the Middle East that causes crude oil to retreat sharply, or weaker-than-expected Chinese soybean purchases following the Washington summit.

Today Markets View

Soybean oil remains fundamentally supported, but the technical structure is increasingly important.

65 and 73.5 are the key levels. Until one of those boundaries gives way with sustained acceptance, the market remains a range rather than an established directional trend.

The fundamental backdrop, however, creates the potential for a significant breakout. Biofuel mandates provide structural demand, elevated energy prices maintain a degree of support for vegetable oil feedstocks, while Chinese soybean buying introduces an important demand catalyst.

Louis Roche, Analyst at Today Markets, said:

“Soybean oil remains caught between strong structural support from biofuel demand and a well-defined technical range. The 65–73.5 zone is currently the key battleground, but the combination of Chinese demand, energy prices and the outcome of the Washington summit could provide the catalyst required to break that range.”

The Bottom Line

Soybean oil remains at an important technical crossroads.

The 65 area has repeatedly attracted buyers, while 73.5 has so far capped the upside. A break above 73.5 would place 80 and potentially 85 back into focus, while sustained acceptance below 65 would expose 60 and 56.5.

Fundamentally, record biofuel mandates, elevated crude oil prices and Chinese soybean demand continue to provide support. Conversely, any meaningful de-escalation in the Middle East or disappointment on Chinese purchases could quickly weaken the bullish case.

For now, the market remains in Range 1, but the next sustained move outside 65–73.5 could establish the direction for the next major phase of the soybean oil market.

For continued agricultural, energy and commodities analysis, visit Today Markets. For FX and cross-market analysis, Currency Hedger provides additional market intelligence across global financial markets.

Analysis by Louis Roche, Analyst, Today Markets
Currency Hedger Contributor: Currency Hedger Market Intelligence

Disclaimer

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