India is strategically making rare, long-term soybean and soyoil purchases to ensure a stable and affordable supply, reflecting a proactive approach to managing its vegetable oil needs and supporting domestic industries. This move comes as the country navigates a complex landscape of domestic oversupply, fluctuating global prices, and evolving trade dynamics.
One significant development was India's record purchase of 300,000 metric tons of soyoil from Argentina in September 2025. This unprecedented two-day buying spree was triggered by Argentina's decision to temporarily scrap export taxes on soybeans and other food products in an effort to boost overseas sales and strengthen its currency. The soyoil, priced between $1,100 and $1,120 per ton (CIF), is slated for shipment between October 2025 and March 2026. This large-scale purchase is expected to help Argentina reduce its soyoil stocks but may also impact palm oil shipments from Indonesia and Malaysia to India.
Prior to the Argentine deal, India also made a notable purchase of soybean oil from China. In July 2025, Indian importers bought a record 150,000 tonnes of soybean oil from China, taking advantage of a supply glut that forced Chinese processors to offer discounts. Chinese processors were offering soybean oil at $1,140/t CIF for December delivery, while South American oil was being offered at $1,160/t. This shift marks a change in India's sourcing pattern, as it traditionally imports soybean oil mainly from Argentina and Brazil. The price advantage and lower logistics costs—with shipments from China taking only two to three weeks compared to over six weeks from South America—made Chinese soybean oil an attractive option.
These strategic imports are occurring against the backdrop of a complex domestic scenario. Despite India being a major soybean producer, local crushers have been hesitant to purchase domestically grown soybeans, leading to an oversupply in the market. This reluctance is partly due to the declining margins for domestic crushers. When one tonne of soybean is crushed, 82 per cent of the output (soybean meal) is currently selling at Rs 27/kg (March 2025 prices), compared to Rs 42/kg in December 2023. Even though the remaining 18 per cent (soybean oil) is fetching about 20 per cent higher prices (Rs 118/kg in March 2025 vs Rs 138/kg in December 2023), the overall revenue per tonne of crushed soybean has declined—from Rs 55,555 in December 2023 to Rs 46,515 in March 2025. These lower margins are discouraging domestic crushers from processing soybean, leading to excess supply in the mandis.
To support farmers, the Indian government has intervened by agreeing to purchase soybeans at state-set support prices in states like Madhya Pradesh and Maharashtra. This intervention aims to alleviate the distress caused by a crash in domestic soybean rates, which have fallen below the government-mandated support price.
Looking ahead, the US Soybean Export Council (USSEC) anticipates that India will increase its imports of US soybean meal in the coming years. This expectation is based on India's past purchases of US soybean meal to address poultry feed shortages and the potential for increased soybean consumption in the future.
