Crush margin

The crush margin is the difference between the value of the oil and meal produced from crushing an oilseed and the cost of the oilseed itself.

Crushing an oilseed such as soybeans splits it into oil and meal, two products sold separately, often into very different markets: the oil into food or biofuel, the meal into animal feed. The crush margin is the value of that oil and meal combined, minus the cost of the beans used to produce them, and it is what a processor earns for running the plant.

Processors watch the crush margin far more closely than the price of soybeans alone, since a plant can be profitable even when bean prices are high if oil and meal prices have risen enough to cover it, and unprofitable even when bean prices are low if product prices have fallen further. A widening crush margin tends to pull more beans toward processing rather than direct export, and a shrinking one can idle crushing capacity.