September 3, 2020

China purchases 480,000 tonnes of US soybeans for December-January shipment

State-owned Chinese companies have purchased eight cargoes, or about 480,000 tonnes of soybeans from the United States to be shipped in December and January, according to two US traders, Reuters reported.

The US traders, who are familiar with the deal, told Reuters that the majority of cargoes will be exported from Pacific Northwest ports with the rest leaving from US Gulf Coast terminals.

The purchase adds to the growing number of US commodity deals by China as part of its pledge in the US – China Phase 1 trade deal signed earlier this year.

China has switched to buying more soybeans and other goods from the US following record soybean purchases from Brazil earlier this year.

China, the biggest commodity importer in the world has purchased record volumes of corn, pork and poultry from the US this year, and booked its biggest US beef weekly purchase in August.

The US Department of Agriculture (USDA) said China had purchased 1.2 million tonnes of corn in the week beginning August 31.

As China's food inflation soars to its record highest, traders project China's demand to continue.

China usually purchases more US soybeans in the fourth quarter of the year, the same time US crops are harvested, with reduced Brazil supplies.

US Census Bureau trade data showed China's purchases in the first half of 2020 amounted to US$7.274 billion, lower than the pledged US$36.5 billion in yearly purchases pledged in the US – China Phase 1 agreement.

-      Reuters