China soybean processors are purchasing record volumes of Brazilian soybeans and cutting purchases of U.S. soybeans. U.S. soybeans face steep tariffs in China thanks to the ongoing tit-for-tat trade war between the U.S. and China.
A Singapore-based trader told Reuters that China is “willing to pay higher prices for Brazilian beans than what domestic crushers are paying.”
Brazil’s typical soybean export season ends in September, and the U.S. provides to the market through March. However, China is importing a record 14 million metric tons of Brazilian soybeans for arrival in October and November. In 2017, Brazil shipped just under nine million metric tons of soybeans to China in the final quarter, which was the previous record.
Brazil is the world’s top soybean exporter and the United States is the second top exporter.
U.S. farmers are harvesting an estimated record soybean crop this year, but China has purchased just a fraction of soybeans from the U.S. compared to its long-term average.
Source: National Association of Farm Broadcasting News Service.