China Buys First Cargoes of US Soybeans This Season
Xi Jinping and Donald Trump to Meet Oct. 30
Key Takeaways:
- China and the U.S. reached a broad framework for a trade deal.
- Trump and Xi are due to meet Oct. 30
[Stay on top of transportation news: .]
China has bought at least two cargoes of U.S. soybeans, its first known purchase this season, which may mark a revival of flows as part of a wider settlement expected to be agreed between the two biggest economies this week.
The shipments are booked for loading and possible delivery later this year, according to people familiar with the matter. They asked not to be named as they are not authorized to speak to media.
Chinese and U.S. officials reached abroad framework agreementover the weekend in Malaysia, paving the way for Chinese leader Xi Jinping and President Donald Trump to finalize a trade deal that would roll back many of the tariffs, fees, and export restrictions threatened or implemented in recent weeks. The two are due to meet Oct. 30.
Beijing had shunned U.S. soybeans so far this export season, using the commodity as abargaining chipin its trade war with Washington. Chinese crushers turned instead to South America for record shipments and have built ample supplies. But the diversification also exposed them to higher costs and weather-related risks.
China will make “substantial” purchases of U.S. soybeans, Treasury Secretary Scott Bessent tells after trade talks with Chinese counterparts in Malaysia, adding that the global soybean market has been brought “back into equilibrium.”
“Soybean farmers are going to be… — Face The Nation (@FaceTheNation)
Treasury Secretary Scott Bessent had said that he expected the Asian nation tomake “substantial” soybean purchasesafter American and Chinese negotiators came to terms on a range of contentious points at talks over the weekend.
An agreement between the world’s two biggest economies could restart a trade that was worth more than $12 billion last year, reopening access to the world’s largest consumer of soybeans to U.S. growers who have faced prolonged financial strain.
“The news is no doubt positive, but the markets will be waiting to see what are the details of the agreement,” said Chris Nikolaou, general manager ofAdvantage Grain,an Australian agricultural marketing company. “It’s definitely good for international demand, producers and the Chinese consumers.”
Grains traders have been optimistic that China and the U.S. would reach an agreement this week on agricultural products, prompting a rise insoybean pricesin Chicago. However, they remain cautious about how much American soy China will actually buy this season.
It’s unclear if China will commit to fixed volumes of U.S. soybeans, and there’s uncertainty over how any deal would be implemented. With Chinese soymeal prices still weak, even a rollback of tariffs to pre–trade war levels may not make it profitable for Chinese crushers to take American beans, the people said.
Want more news? Listen to today's daily briefing above or go here for more info
A resurgence in imports from what was previously China’s second-largest source of soybeans could help reduce costs. However, a sudden influx of cargoes from the U.S. could put additional pressure on prices of processed products such as soybean meal. American shipments of corn and wheat to China have also plunged to almost zero as Beijingrestrictedimports to protect farmers.
China’s appetite for U.S. soybeans may also be tempered as the world’s second-largest economy struggles to regain growth momentum, limiting demand for animal feed and food. Moreover, Beijing’s long-term strategy to diversify suppliers and reduce reliance on the US is expected to remain in place.
Traders remained cautious. Chicago soybean futures were down 0.5% at $10.90 per bushel as of 7:01 a.m. in Chicago.
