Global soy protein isolate prices are poised to continue their upward trend through the end of May, following a steady rise observed throughout April. The upsurge, according to market experts, is a result of a combination of factors such as supply chain issues, tightening soybean prices, and tight consumption of soy protein isolate by major end-use sectors like food and beverages, dietary supplements, and sports nutrition.

Supply-side pressure on soy protein isolate cost has intensified with growing geopolitical tensions and volatile trade relations between the world's two largest economies—China and the US. Over the past month, China levied a 125% tariff on all US imports, including soybeans, one of the key raw materials employed in the manufacture of soy protein isolate. This increased the overall tariff cost of American soybeans to a whopping 135% when added to a 10% tariff imposed in March.

This hawkish trade policy, now tempered only recently, has already disturbed supply chains, and soy protein isolate market is affected. United States soybean exports to China on the brink of zero viability at such tariffs, China shifted its purchasing trend to other behemoth providers. Brazil, the world's biggest supplier of soybeans, has become the major gainer, and Chinese import of Brazilian soybeans has increased significantly. Argentina, too, being a major player in the international soybean market, is also experiencing increased Chinese interest.

But one recent and surprise turn of events could bring temporary respite to American exporters. On 14th May, the U.S. government cut tariffs on Chinese imports by a dramatic amount, lowering them from 125% to 10%. That is part of a larger 90-day tariff rollback agreement Washington and Beijing inked in April, a tentative step to de-escalate trade tensions. Despite this gesture, hopes of resumed trade flows between the U.S. and China have been buoyed, with industry analysts warning that any benefits for soybean export volumes or prices will take some time to build.

Meanwhile, soybean prices themselves are also high because of tight world inventories and strong demand, which supports cost-push inflation in soy protein isolate.

From the consumers' end, soy protein isolate continues to attract hefty consumption by health-focused consumer groups. The demand for plant-based protein in meat alternatives, ready-to-eat nutrition foods, and functional foods has not been hindered by inflationary pressure. Despite the higher raw material costs, manufacturers have so far been able to pass on some of the cost to the consumers, maintaining price growth in soy protein isolate.

In the future, short of some gigantic geopolitical surprise or policy reversal, experts foresee the current bullish momentum in soy protein isolate prices continuing well through May and maybe even into early summer. Traders are monitoring closely U.S.-China trade talks as well as South American crop harvests, which will have profound effects in determining the pricing direction of soy protein isolate later in the year.