November 9, 2023

 

China makes biggest one-day purchases of US soybean in three months

 

 

China booked its largest single-day US soybean purchases in at least three months on November 7, traders said, offering a glimmer of hope for the most valuable US farm export after overseas sales of the 2023 harvest had fallen well behind the normal pace.

 

Chinese importers bought around 10 cargoes of soybeans, or about 600,000 metric tonnes, for shipment from US Gulf Coast and Pacific Northwest export terminals between December and March, trade sources said.

 

The sales would be a relief to US farmers, who have seen Brazil dominate the global export market for soy as well as corn for longer than normal this year.

 

If confirmed, the sales would be the largest single-day soybean purchases by the world's top soy importer since late July, according to US Department of Agriculture (USDA) daily sales data. They were the latest in a series of soy import deals made by Sinograin, China's state-owned importer, since late last week, according to three export traders with knowledge of the deals. Total purchases over that time were estimated at as much as 20 to 25 cargoes, two traders said.

 

Cash premiums for US soybeans at Gulf Coast terminals jumped by as much as 10 cents a bushel on November 7 as exporters scrambled to source supplies, traders said.

 

High US prices due to barge shipping disruptions and stiff export market competition from Brazil, which harvested a record soy crop this year, have hampered US sales in the season so far.

 

Confirmed sales to China as of late October were down 35% from a year ago, and sales to all destinations were down 28%. The USDA is currently projecting a 12% year-on-year export decline.

 

But US prices have become more competitive for shipments from December through March when Brazil's next harvest will be available.

 

The USDA has confirmed private sales totaling 236,000 metric tonnes of US soybeans over the past two days via the agency's daily reporting system. Traders expect additional "flash sales" following the deals on November 7.

- Reuters