US Soybean Exports Hit As Trump’s Tariffs Drive Chinese Oilseed Importers to Brazil, Other South American Countries

The report said that typically, China procures U.S. soybeans between September and January, and then pivots to purchases from Brazil once harvest begins in South America.

The uncertainty around President Donald Trump’s tariffs has reportedly dented U.S. soybean farmers but boosted the prospects for their Brazilian counterparts.

A Reuters report, citing soybean traders, said that Chinese buyers, who are top importers of the oilseed crop, are gravitating toward Brazil amid the tariff standoff.

Chinese importers have booked eight million metric tons of Soybean cargoes for September, all from South America, the report said, citing traders. 

These importers have contracted to buy four million metric tons of soybeans in October, also from South America. This is half the requirement. But the country will likely complete this year’s bookings by early September.

Chinese oilseed importers have reportedly procured 7 million tons of soybeans from the U.S. during the first two months of 2024.

The report stated that typically, China procures U.S. soybeans between September and January, and then shifts to purchases from Brazil once the harvest begins in South America.

According to the report, China imported 105 million metric tons of soybeans in 2024, with 22.13 million tons or roughly 21% coming from the U.S.

U.S. Department of Agriculture (USDA) data showed that U.S. soybean exports in 2024 totaled 52.21 million metric tons, valued at $24.47 billion. 

On Sunday, President Trump called for China to “quadruple its soybean orders," alluring importers by promising “rapid service” if China made the orders.

Food processing and commodity trading company Archer-Daniels-Midland Company’s (ADM) stock was up 0.34% in the early premarket session on Wednesday. Sentiment toward the stock improved to ‘bullish’ (65/100) by early Wednesday from ‘neutral’ a day ago. Sentiment toward Agribusiness and food company Bunge’s (BG) stock stayed ‘bearish’ (37/100).

The  , the exchange-traded fund (ETF) that tracks the S&P 500 Index, is up 10.31% for the year compared to the 28.5% gain for the iShares MSCI Brazil ETF (EWZ).

China has been reducing its reliance on the U.S. for agricultural commodities since Trump took office in 2021 due to the trade war unleashed by the president.

This week, the U.S. and China agreed to extend the tariff truce by 90 days, offering a reprieve.

The truce may not trigger purchases from the U.S., given that Beijing’s tariffs on U.S. soybean imports stand at 23%, making them uncompetitive. Excluding the tariffs, US soybeans for October shipment would have been cheaper than Brazilian imports by $40 per ton. 

Chinese importers’ decision to stay away from the U.S. market will likely dent the soybean futures pricing on the Chicago Board of Trade, Reuters said. The futures prices have been on a secular downtrend since mid-2022.

Futures pricing for the agricultural commodity climbed for a second straight day on Tuesday after the USDA trimmed its harvest outlook forecast for the 2024/25 period.

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