China Signs First Deal to Purchase American Soybeans for 2024-2025 Season
China, the world’s largest importer of soybeans, has signed its first deal to purchase American soybeans for the 2024-2025 season with a significant delay compared to normal seasons, Bloomberg reports.
The US Department of Agriculture announced on Wednesday that China has bought 132,000 tons of soybeans for the next marketing year. This is the first time China has started purchasing American soybean shipments this late. In the previous season 2023-2024, the Asian country began buying American soybeans in December 2022 — almost seven months earlier than this year.
This purchase comes against the backdrop of recent price declines, making American soybeans more attractive to China. Soybean futures in Chicago have fallen by approximately 17% this year, and earlier this week prices reached the lowest level since 2020.
«The market is finally showing demand, and China cannot completely ignore American soybeans,» said Ben Buckner, chief grain analyst at AgResource Co.
The US competes with Brazil for soybean supplies to China. The weakening of the Brazilian real has shielded farmers from price declines this year and encouraged Brazilian producers to increase sales.
According to Victor Martins, a risk manager at the brokerage firm Amius Ltd., a vivid example of the real’s impact on trade is that Brazilian farmers sold over 4 million tons of soybeans in five days — the highest volume since October 2020 after the currency fell to its lowest level in the last two years compared to the dollar.
