News Capsule: Indication of Tariff Relief on US Soybean Oil and DDGS
07-Feb-2026 10:29 AM
News Capsule: Indication of Tariff Relief on US Soybean Oil and DDGS
★ Under the ongoing trade negotiations between India and the United States, an interim framework indicates that India has agreed to consider future tariff reductions or phased elimination of import duties on US soybean oil and Dried Distillers Grains with Solubles (DDGS).
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Edible Oil Market Watching Closely
★ If import duties on US soybean oil are reduced in the future, its landed cost could become more competitive compared to South American supplies. Currently, India imposes an effective import duty of 27.5% on crude soybean oil and 35.75% on refined soybean oil.
★ India imports soybean oil from the US, Brazil, Argentina, and Russia. However, the share of US-origin soybean oil in total imports remains very small at present.
★ Any tariff relief could alter the import pattern. This may keep domestic refined oil prices under limited pressure, while potentially affecting the margins of domestic oil mills.
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Possible Support for the Feed Sector
★ DDGS is an important ingredient in poultry, dairy, and aquaculture feed. A reduction in tariffs could provide cost advantages to feed manufacturers.
★ However, DDGS is not a complete substitute for soybean meal. Its usage is limited to a certain proportion in feed formulations. Therefore, a sharp decline in soybean meal demand is unlikely, though the growth pace may slow.
★ India already has a large stock of DDGS available domestically. The key factor to watch will be the price at which future imports are undertaken.