China Buys Nearly 1 Million Tons of US Soybeans

Reuters’ Karl Plume reported that “China bought at least 14 cargoes of U.S. soybeans on Monday, two traders with knowledge of the deals said, its largest purchase since at least January and the most significant since a summit between President Donald Trump and President Xi Jinping in October.”

“China is buying U.S. soybeans to meet the pledges it made to Washington at the trade summit in Busan, South Korea, even though the cargoes are priced higher than rival Brazilian offers, two Asia-based traders said,” Plume reported. “‘This bigger round of U.S. soybean buying is no longer a goodwill gesture but a manifestation of China’s commitment to the Busan terms,’ said a Singapore-based trader.”

“China’s state-owned grain trader COFCO bought at least 840,000 metric tons for shipment in December and January, the two traders with knowledge of the deals told Reuters,” Plume reported. “Eight of the vessels were for shipment in December and January from U.S. Gulf Coast terminals, while the rest were for shipment in January from Pacific Northwest ports, one trader said. A second trader estimated around 75% of the sales were for Gulf shipment, with the remainder from the Pacific Northwest ports.”

During the government shutdown, USDA daily sales data showed China made two soybean purchases totaling 232,000 metric tons, bringing China’s total recent soybean buys to nearly 1 million metric tons.

“Asian traders estimated COFCO paid $2.35-$2.40 per bushel over the January Chicago contract for shipments from Gulf terminals and a premium of $2.15-$2.20 per bushel from Pacific Northwest ports, well above the prices for Brazilian new-crop soybeans, which are around $1.25 per bushel over CBOT futures,” Plume reported. “‘It is a political move, as prices being paid by COFCO are much higher than Brazilian prices,’ said a trader at a company which runs soybean processing plants in China. ‘Chinese companies are just doing it as a commitment to buy U.S. soybeans.'”

Bloomberg’s Hallie Gu reported that “the purchases have reignited market optimism around the soybean trade between the two agricultural powerhouses, which was worth more than $12 billion last year and will underpin any trade agreement.”

“Beijing’s latest purchases still leave plenty to be done in the coming months, however, at a time when stockpiles are plentiful. Washington has said Beijing pledged to buy 12 million tons of US soybeans by end of this year, followed by 25 million tons annually over the next three years,” Gu reported. “While China has yet to confirm the specific purchase commitments, it has moved to reduce tariffs on the crop and lifted import bans on three American exporters, including CHS Inc., reciprocating similar conciliatory actions from the US.”

“President Donald Trump has reiterated Washington’s belief that more cargoes will be booked in the coming weeks,” Gu reported. “‘They’ll be doing a lot of soybean purchases,’ he told reporters aboard Air Force One last week, adding that they could start before spring.”

China Trade Deal Not Yet Finalized

Axios’ Ben Berkowitz reported that “the U.S. trade deal with China isn’t finalized yet, but America has to trust that Chinese leaders will keep their word, Treasury Secretary Scott Bessent said Sunday.”

“It was only a month ago that Bessent said China couldn’t be trusted. His shift in tone captures the uneasy stakes of a pact central to global trade in rare earths and American soybeans,” Berkowitz reported. “Administration officials hope their changing tone in recent weeks can bring the sweeping pact to fruition.”

“‘We haven’t even finished the agreement, which we hope to have done by Thanksgiving,’ Bessent said in an interview with Fox News’ ‘Sunday Morning Futures,'” Berkowitz reported. “Bessent said he was confident that after ‘our meeting in Korea, between the two leaders, President Trump, President Xi, that China will honor their agreements.'”