Brazil's oilseed processing sector is stepping up. According to Abiove, the oilseed lobby, processors will spend R$5.9 billion (approximately US$1.11 billion) over the next twelve months to increase domestic soybean crushing capacity by around 8%, equivalent to roughly 6 million metric tons per year. The goal: to keep pace with surging demand for biodiesel.

The anticipated expansion would elevate Brazil's total crushing capacity to over 80 million tons per year, should all planned investments move forward. Currently, about 75% of the country's biodiesel is made from soy oil, underscoring the centrality of soy in Brazil's biofuel supply chain.

Major global agribusiness firms-Bunge, ADM, and Cargill-are among the leaders in this build-out. These companies are aligning investments with Brazil's biofuel policy, which mandates a blend of 15% biodiesel into diesel, a level expected to increase further.

Since last year, the number of soy processing firms has increased from 67 to 75, and the number of crushing plants has grown from 132 to 144. Despite this expansion, there remains some idle capacity-about 3.87 million tons per year in 2025, compared to 4.7 million tons in 2024.

Brazil is already the world's largest soybean producer and exporter. It ranks third in soy processing volume, behind only China and the United States.

The increase in installed capacity signals not only industry dynamism but also reflects the strategic importance of soy processing to Brazil's agricultural economy, especially amid rising input costs, regulatory pressure, and global demand for sustainable agriculture.

Implications for U.S. Agriculture Professionals

This surge in Brazil's crushing capacity carries significant implications for the U.S. ag sector.

As Brazil processes more of its soybeans domestically, its exportable surplus may decline. This could tighten global soybean supplies, potentially leading to price increases that ripple across commodity markets, impacting U.S. crushers, exporters, and co-ops.

Higher soy oil production in Brazil will also affect international markets, especially if supply exceeds domestic demand. This may influence feed prices, livestock margins, and even U.S. soybean planting decisions in the coming seasons.

The expanded production also puts pressure on U.S. producers to maintain global competitiveness. Precision agriculture, input efficiency, and technology adoption become more vital as Brazilian firms gain scale and reduce processing inefficiencies.

In addition, the growing alignment between Brazil's energy policy and agricultural investment sends a message to global buyers. Sustainability, traceability, and reduced deforestation risks are becoming standard expectations in international grain markets. U.S. exporters may need to further certify and verify their supply chains to meet these evolving requirements.

As global demand for renewable fuels intensifies, Brazil's investment could reshape trade flows and production priorities-redefining where value is captured in the soybean supply chain.