What does the Iran conflict mean for oilseed prices?

The Israeli-US attacks on Iran have transformed the narrative on financial markets. 

The primary impact has been on energy markets, given the region’s importance in shipping of both crude oil and liquefied natural gas (LNG). 

However, for grains and oilseeds, the conflict holds substantial significance too although, as CRM Agri has assessed, outcomes will depend on the extent of the conflict – crucially, determined by both duration and geography. Currently the situation is moving into Scenario 2 which we outlined. 

Rapeseed:

• Energy‑market shocks from the Iran conflict influence rapeseed due to its oil‑linked biodiesel use.
• Rapeseed futures historically react slowly to geopolitical crises despite strong links to crude oil.
• Limited liquidity in rapeseed futures restricts large fund participation and price responsiveness.

•           Conflict expansion threatening Red Sea routes could disrupt Australia–EU canola shipments

Soybeans:

• Soybeans less sensitive to oil price because their value is driven heavily by soymeal
• During June’s Israeli attack on Iran, crude rose 11%, but soybeans only 2.6%
• Middle East takes 11% of global soymeal imports (8.6 Mt). Iran takes 3.0 Mt, ranked joint 5th globally
• If crude oil stays strong, soyoil will likely find support, moderating soybean downside