Purchasing soybean oil wholesale is an excellent way for food manufacturers, distributors, retailers, and industrial buyers to secure the soybean oil that they require at a more competitive cost.
However, there are several considerations that should be made before making that purchase.
This guide will discuss the different types of soybean oil that are available in bulk, the specifications that are required for each type, the different packaging options that are available, the different prices that can be found, and the purchasing process that can be used by buyers.
Whether you are looking for soybean oil for sale, evaluating different soybean oil suppliers, or planning to purchase soybean oil for sale in bulk, this guide will help you make an informed decision.
What Is Soybean Oil?
Soybean oil is a type of vegetable oil that is extracted from soybeans.
It is used in a variety of different applications, including cooking, frying, baking, margarine production, salad dressings, mayonnaise, packaged foods, animal feed, biodiesel, and other industrial applications.
Soybean oil is mild in taste and available in many locations, making it an excellent choice for those companies that require a steady supply of edible oils.
A soybean oil supplier may offer several different types of soybean oil, including crude soybean oil, degummed soybean oil, refined soybean oil, high-oleic soybean oil, and packaged soybean oil.
Why Businesses Buy Soybean Oil Wholesale
There are several benefits for companies that choose to purchase soybean oil wholesale.
These benefits include:
- Lower costs per unit
- The ability to maintain a steady supply of soybean oil
- A variety of packaging and delivery options
- The ability to maintain consistent soybean oil specifications
- The ability to package the soybean oil for private-label distribution
- Better inventory control
- Direct access to the exporters or manufacturers of the soybean oil
Additionally, purchasing soybean oil in bulk for high-volume users will reduce costs related to packaging and simplify the planning of soybean oil production.
Main Types of Soybean Oil Available in Bulk
Before requesting a quotation for soybean oil, it is important for buyers to know exactly what type of soybean oil they require.
Each type of soybean oil has different specifications and uses.
Crude Degummed Soybean Oil
Crude degummed soybean oil is often referred to as CDSO.
It is used by soybean oil refineries, industrial processors, biodiesel manufacturers, feed manufacturers, and any other company that has its own soybean oil refining facilities.
However, this type of soybean oil is not intended for direct use in the home as it will require further refining.
Specifications for crude degummed soybean oil include: free fatty acids in the range of 0.5% to 1.5%, moisture and other impurities within specific agreed limits, phosphorus in the range of 200 ppm, an amber to dark yellow appearance, and packaging in flexitanks, tankers, vessels, or tanks.
These specifications should always be confirmed with the supplier with the Certificate of Analysis.
Refined, Bleached and Deodorized Soybean Oil
Refined, bleached, and deodorized soybean oil is referred to as RBD soybean oil.
This oil has been further processed from crude soybean oil to remove its impurities, color, taste, and odor.
This is the most common type of soybean oil that is offered by soybean oil wholesale suppliers.
RBD soybean oil is used for commercial frying, restaurants, food manufacturing, baking, sauces, dressings, margarine, and is often bottled for retail and private-label distribution.
This type of oil is what is most often required by buyers that are searching for soybean oil for sale for use in food preparation.
Typical specifications for refined soybean oil include: a neutral taste and odor, a light yellow color, low free fatty acids, low moisture, and good heat stability.
High-Oleic Soybean Oil
High oleic soybean oil is produced from soybean varieties that have been developed to contain higher percentages of oleic acid.
This soybean oil has a longer life and is more stable when exposed to heat.
Additionally, it can reduce the need for partial hydrogenation of soybean oil in food products.
High oleic soybean oil is often used for deep frying, snack foods, baked goods, and shelf-stable products for foodservice establishments.
It is more expensive than refined soybean oil due to its specialty nature and limited availability.
Typical Soybean Oil Quality Specifications
The quality specifications listed below are some of the most commonly used quality specifications for soybean oil.
| Quality Parameter | Crude Degummed Soybean Oil | Refined Soybean Oil |
|---|---|---|
| Free Fatty Acids | 0.5%–1.5% | 0.1% Maximum |
| Moisture and Volatile Matter | 0.3% Maximum | 0.1% Maximum |
| Phosphorus | 200 ppm Maximum | 10 ppm Maximum |
| Peroxide Value | 10 meq/kg Maximum | 5 meq/kg Maximum |
| Appearance | Amber or Dark Yellow | Light Yellow |
| Odor and Taste | Characteristic of Crude Soybean Oil | Neutral |
| Intended Use | Further Processing or Refining | Direct Food Use and Manufacturing Use |
These specifications should not replace the specifications that are agreed to by the buyer and supplier.
Each buyer should request a Certificate of Analysis from the supplier and has the specifications clearly stated in their purchase contract.
Common Packaging Options for Bulk Soybean Oil
The soybean oil supplier will recommend the packaging that is best for the buyer based on the quantity that is being ordered, the destination of the soybean oil, the handling facilities of the buyer, and the intended use of the soybean oil.
Bulk Tanker
Bulk tankers are common for deliveries within a country or region to facilities with soybean oil storage tanks.
These deliveries are common for food manufacturers, industrial processors, refineries, and distributors.
Flexitank
Flexitanks are large, single-use containers that fit inside standard shipping containers.
These containers are commonly used for shipping soybean oil internationally.
The benefits of using flexitanks for soybean oil shipment include:
- The ability to ship large quantities in a single container
- Cost savings on packaging
- Suitability for shipping food-grade liquids
- Cost savings compared with shipping drums or IBCs
- The convenience of using shipping containers for international shipments
The flexitank must be food-grade and installed by a company experienced in installing flexitanks for soybean oil shipment.
Intermediate Bulk Containers
Intermediate bulk containers, or IBCs, are containers that are often used for medium-sized soybean oil orders by buyers that do not have soybean oil tankers.
IBCs generally contain 1,000 liters of soybean oil.
These containers are easier to handle, dispense, and store in warehouses.
Additionally, they have smaller minimum order quantities and reduced risk of contamination when properly sealed.
Drums
Drums made from food-grade steel or plastic can be used by industrial buyers that require smaller shipments of soybean oil.
While drums are convenient, they tend to increase the packaging, handling, and freight cost per ton of soybean oil.
Retail Bottles
Refined soybean oil is also available in PET bottles for retail distribution and private-label sales.
Bottles are available in various sizes, including:
- 500 ml
- 1 litre
- 2 litres
- 3 litres
- 5 litres
Orders for these bottles require the parties to agree upon the type of label, carton configuration, label language, barcode placements, and minimum order quantity.
Leading Soybean Oil Supply Origins
The origin of the soybean oil affects the price, lead time, documentation, availability based upon season, freight cost, and buyer preference.
Brazil
Brazil is one of the major soybean oil producing countries in the world.
The soybean oil suppliers from Brazil offer a variety of products, including:
- Crude degummed soybean oil
- Refined soybean oil
- Flexitank shipments
- Bulk vessel quantities
- FOB and CIF prices
Buyers of soybean oil from Brazil should confirm the products’ loading ports, refineries, certifications, and export histories.
Argentina
Argentina is one of the most developed soybean oil producing and exporting countries.
The majority of soybean oil activity in Argentina occurs in the Rosario region.
Suppliers from Argentina are ideal for buyers seeking large quantities of crude and refined soybean oil.
United States
The United States is one of the major soybean oil producing countries in the world.
The United States has some of the most developed food safety and traceability regulations for soybean oil.
American soybean oil is ideal for buyers looking for products with extensive product documentation, traceability, high oleic soybean oil, food grade quality, and compliance with food safety regulations.
Paraguay and Uruguay
These countries produce relatively smaller quantities of soybean oil but provide competitive opportunities for buyers willing to pursue their products.
Buyers should review the landed costs rather than the FOB prices for the products from these countries.
How to Choose a Reliable Soybean Oil Supplier
While there are many companies that supply soybean oil, not all of them have direct access to the product, its production facilities, or its exporters.
A reliable soybean oil supplier will offer transparency into their product, company, documentation, pricing, and shipment processes.
Verify the Company
Before making any payments to a soybean oil supplier, buyers should verify the following information regarding the company:
- Company registration name
- Company registration number
- Registered address
- Tax or VAT information
- Company bank account information
- Export experience
- Official email address
- Website and business references
The beneficiary name on the bank account should match the contracting company unless third parties are involved (which should be documented).
Request Product Documentation
A soybean oil supplier should be able to provide the following documentation:
- Product specification sheet
- Certificate of Analysis
- Food safety certificate
- Certificate of Origin
- Health certificate
- Packing list
- Invoice
- Bill of Lading
- Insurance certificate
- Inspection certificate (if agreed upon).
These documents will vary based upon product, origin, destination, and contract terms.
Review Food Safety Certifications
Suppliers should also have food safety certifications for the production facility, including:
- ISO 22000
- FSSC 22000
- HACCP
- BRCGS
- IFS
- Halal certification
- Kosher certification
- GMP certification
Certificates should be current and applicable to the facility that produces the soybean oil.
Confirm the Certificate of Analysis
The Certificate of Analysis should contain information regarding the product’s grade and specifications.
Some of these specifications include:
- Free fatty acids
- Moisture
- Peroxide value
- Phosphorus
- Color
- Iodine value
- Saponification value
- Insoluble impurities
- Odor and appearance
For significant purchases, buyers can initiate third party inspections from companies like SGS, Bureau Veritas, Intertek, Cotecna, or others.
Evaluate Communication and Transparency
A soybean oil supplier should answer the buyer’s questions.
Be cautious of suppliers that:
- Refuse to disclose product origin
- Refuse to disclose company registration documents
- Pressure buyers to make immediate payments
- Offer prices that are significantly lower than the market price
- Use different bank account information for buyers
- Refuse to explain inspection processes
- Provide certificates that have been altered
- Refuse video meetings with buyers to verify facilities.
Questions to Ask Before Requesting a Quote
Before requesting a quotation from a soybean oil supplier, the buyer should provide the following information:
- Grade of soybean oil
- Quantity
- Demand period (monthly or annually)
- Packaging
- Destination
- Incoterm
- Delivery period
- Certifications
- Inspection requirements
- Import requirements for the destination country
- Private label requirements (if applicable)
For example, buyers can request the following quote:
I would like 500 MT of refined soybean oil in flexitanks to be delivered CIF to the Port of Tema, Ghana. Please provide the specifications, origin, loading schedule, payment terms, inspection methods, and quotation validity.
Providing this information will allow the supplier to determine the freight, packaging, port charges, documentation, and production availability.
Understanding Soybean Oil Wholesale Prices
Soybean oil has a fluctuating price.
Some of the factors that influence the price of soybean oil include:
Soybean crop conditions
Weather conditions in the major soybean producing countries can have a significant impact upon the price of soybean oil.
Severe droughts, flooding, extreme heat, or delayed planting and harvesting can drive up prices.
Futures markets
Major commodity exchanges trade soybean oil futures contracts.
These prices are often used as a reference for soybean oil prices.
The soybean oil price that you pay will, however, include other costs such as premium prices for the supplier, processing costs, shipping costs, packaging costs, financing costs, and export costs.
Crude oil and biodiesel demand
The demand for biodiesel from soybean oil can drive up the prices of soybean oil.
When the demand for biodiesel increases, less soybean oil is available for the food market.
Packaging
Bottled soybean oil, drums, and IBCs tend to cost more per ton of soybean oil than flexitanks or tanker deliveries.
Packaging costs include:
- The packaging itself
- Caps
- Labels
- Cartons
- Pallets
- The labor to fill the bottle
- The labor to store the bottles
- Delivery costs.
Freight and delivery terms
The delivery terms of your soybean oil purchases will have a significant impact upon the cost of your order.
Some of the most common delivery terms include:
- EXW
- FOB
- CFR
- CIF
- DAP
Prices should be compared using the same delivery terms.
FOB price versus landed cost
The lowest price for FOB is not always the best price.
Buyers should consider all the costs of the soybean oil and how it will arrive at their facilities.
Costs to consider include:
- Price of the soybean oil
- Packaging costs
- Inland shipping costs
- Export documentation costs
- Port handling costs
- Ocean shipping costs
- Insurance costs
- Import duties
- Taxes
- Customs clearance costs
- Handling at the destination
- Inland delivery
- Banking charges
- Inspection costs
The best price for soybean oil in bulk is the total cost of the product upon delivery to the buyer’s facilities.
Recommended payment terms
Payment terms for soybean oil purchases may depend upon the value of the purchase, the supplier, and the country of origin.
Common payment terms include:
- Irrevocable letter of credit
- Documentary collection
- Partial advance payment with the balance due upon delivery of the documentation
- Escrow payments
- Open account payments for buyers with established relationships with the supplier.
New buyers should avoid sending large advance payments to unverified suppliers.
A soybean oil sales contract will typically include the following information:
- Product specifications
- Quantity
- Packaging
- Price
- Delivery terms
- Delivery schedule
- Inspection methods
- Payment terms
- Required documentation
- Claims procedures
- Governing law
- Force majeure conditions
Common Mistakes Buyers Should Avoid
Choosing a Supplier Based Only on Price
An offer that is unusually cheap for soybean oil may suggest that the supplier has failed to account for several important costs in their pricing.
Instead, buyers should compare the products based on their specifications, certifications, reliability of the supplier, and the total landed cost of the product.
Failing to Define the Product Grade
Soybean oil comes in various grades and is used for different purposes.
For instance, soybean oil can be crude, degummed, refined, high-oleic, food-grade, industrial-grade, non-GMO, Halal, Kosher, or any other specific grade.
Ignoring Destination Requirements
Each country of destination for soybean oil has its own requirements for labeling, food safety, import permits, inspections, and certificates.
Buyers should confirm these requirements prior to the production and shipment of the soybean oil.
Skipping Independent Inspection
An independent inspection of soybean oil can help to reduce the risk of quality or quantity complaints.
This is especially important for first-time orders and for shipments of high value.
The contract should specify who will appoint and pay for the inspector and what inspection standards will be used.
Accepting Unclear Shipping Terms
The shipment quotation for soybean oil should clearly indicate the loading point, destination, Incoterm version, included and excluded charges, shipment window, packaging basis, and quotation validity.
A Practical Soybean Oil Buying Process
The following process can help buyers to avoid delays and misunderstandings when purchasing soybean oil.
Step 1: Define Your Requirements
Define the grade, quantity, packaging, specifications, destination, and delivery schedule of the soybean oil you wish to purchase.
Step 2: Shortlist Suppliers
Shortlist several soybean oil suppliers that are verified and have experience in producing or exporting soybean oil.
Step 3: Request Documents
Request documents from the shortlisted suppliers to review their company information and soybean oil specifications.
Step 4: Obtain Comparable Quotations
Request quotations from the shortlisted suppliers for the same quantity, packaging, destination, and using the same Incoterm.
Step 5: Verify the Supplier
Use the documents provided by the suppliers to conduct your due diligence and verify their legitimacy.
Step 6: Negotiate the Contract
Negotiate the terms of the contract with the supplier to agree on the specifications, payment, inspection, delivery, documentation, and claims procedures.
Step 7: Inspect Before Shipment
Arrange for the inspection of the soybean oil before it is shipped, if desired.
Step 8: Review Shipping Documents
Review the shipment documents provided by the supplier before submitting payment or customs documentation.
Where to Find Soybean Oil for Sale
Soybean oil can be sourced from several types of suppliers.
Buyers can source the product directly from soybean oil manufacturers, refineries, agricultural processors, exporters, distributors, international trading companies, and food ingredient suppliers.
Direct sourcing can provide stronger pricing for bulk orders, but distributors provide smaller minimum order quantities and faster delivery to local buyers.
The best source of soybean oil depends on the buyer’s requirements for quantity, destination, storage, packaging, and frequency of purchase.
Final Thoughts
For a successful wholesale purchase of soybean oil, buyers need to look beyond the price.
Buyers must review the specifications of the soybean oil, its packaging, origin, certifications, the reputation and reviews of the supplier, the inspection process, and the shipping terms.
A supplier of soybean oil should provide buyers with all the information needed about the product and the supply terms.
Regardless of the use of the soybean oil (whether for food manufacturing, retail distribution, catering, refining, or industrial applications), the purchasing process described will protect buyers and ensure a steady supply of soybean oil.
Frequently Asked Questions
What is the minimum order quantity for bulk soybean oil?
The minimum order quantity from any supplier varies. Bottled soybean oil is typically sold by the pallet or container. Flexitank shipments typically require a full container shipment, while tanker and vessel quantities are used for contracts of larger sizes.
Is refined soybean oil suitable for cooking?
Refined soybean oil that is of food-grade quality is suitable for cooking with dishes such as frying, baking, sauces, margarine, salad dressings, and more.
What is the difference between crude and refined soybean oil?
Crude soybean oil has not undergone further processing from its extraction from the soybean. Refined soybean oil has been processed to remove impurities, color, odor, moisture, and free fatty acids.
Can soybean oil be supplied in flexitanks?
Flexitanks are commonly used for the international shipment of bulk soybean oil for food manufacturers and distributors of full-container quantities of soybean oil.
What documents should a soybean oil supplier provide?
Supplier documents may include an invoice, packing list, certificate of analysis, certificate of origin, bill of lading, insurance certificate, health certificate, and inspection certificate.
How can I verify a soybean oil wholesale supplier?
A buyer can verify a soybean oil supplier by reviewing the company registration, the certificates, the bank details, export references, video meetings, and inspection reports prior to shipment.
Can soybean oil be supplied under a private label?
Many soybean oil suppliers offer private-label soybean oil, which is dependent upon minimum order quantities, the availability of packaging, label approvals, and destination market regulations.