Importers purchase U.S. soybeans due to brazilian supply shortage
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In recent days, some Chinese importers have acquired shipments of soybeans from the United States, according to grain traders from Europe and the United States who spoke to Reuters on Tuesday. It is estimated that each shipment consists of around 65,000 metric tons and is scheduled to be shipped in July.
According to statements provided by these traders, the two shipments were purchased for July delivery from the Pacific Northwest coast of the United States. These purchases were made on Monday, and it is believed that the buyer is a Chinese state-owned organization aimed at increasing reserves.
This acquisition marks a notable change, given that the pace of U.S. soybean purchases by China has significantly decreased this year. The world’s largest soybean buyer has been turning to cheaper supplies from South America. According to data from the United States Department of Agriculture, there have been no reported sales of U.S. soybeans to China for the 2024-2025 marketing year.
Traditionally, Brazil, one of the world’s leading soybean producers, ships most of its crop from March to June. However, the current season has been affected by severe flooding in the state of Rio Grande do Sul, a major soybean producer. These floods have disrupted the harvest, reduced production estimates, and caused significant losses in the livestock industry.
Over the past three weeks, Brazilian soybean export premiums have increased significantly, leading international buyers to seek alternatives. “Brazilian export premiums are firming as the export season passes its peak, making U.S. soybeans more attractive,” commented a European trader. “This is opening a window for the United States, although the Chinese are still buying in Brazil,” he added.
Data from Chinese customs published on Monday reveal that Chinese soybean imports from Brazil increased by 11.7% in April compared to the previous year, as Brazilian soybeans continue to arrive at Chinese ports. This increase comes despite the adverse weather conditions that affected Brazilian production.
Meanwhile, Chinese imports of soybeans from the United States in the first four months of 2024 decreased by 40% compared to the previous year. This decline underscores the shift in China’s preferences towards cheaper South American supplies.
Although the overall outlook shows a Chinese preference for South American soybeans, recent climatic issues in Brazil and rising export premiums have created an opportunity for the United States to increase its soybean exports to China. This market dynamic will continue to evolve as both producing countries face challenges and opportunities in the international soybean trade.
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