China’s state-owned agri-food company, called COFCO (China National Cereals, Oils, and Foodstuffs), bought three cargoes of U.S. soybeans this week. Two trade sources told Reuters that the country’s first U.S. soybean buy of the season happened shortly before a summit of leaders Donald Trump and Xi (ZHEE) Jinping.
The deal calls for a December-January shipment of about 180,000 metric tons of soybeans, the first purchase in months. However, traders say they don’t expect a significant resumption in demand for U.S. soybeans after several big purchases of South American soybeans.
Bloomberg said grain traders have been optimistic that China and the U.S. would eventually reach a deal this week, which pushed soybean prices higher in Chicago. However, they are still cautious about how much China will actually purchase during this season.
With weak Chinese soymeal prices, some still question the profitability of soy imports for Chinese crushers, even if tariffs revert to pre-war levels.
