WHO NEEDS THE US? China boosts soy imports from Brazil amid tensions with Washington

0 2,110

BEIJING – China placed a large order for Brazilian soybeans this week, choosing Brazil to fill the supply gap after stopping US purchases.

According to sources familiar with the situation, Chinese companies have already imported between 25 and 30 loads of soybeans this week, equivalent to about 1.5 million-2 million tons.

Buyers are increasingly looking for Brazilian soybeans, and have not yet bought enough to meet their needs for October, according to sources quoted by Bloomberg, who asked not to be identified as it is a private business.

China halted US soybean imports as tensions between Beijing and Washington increased and turned to South America.

For now, Brazil has been able to respond to China’s demand, but its supply is running low and Beijing is at risk of failing to meet its needs.

In addition, Argentina’s soybean supply problems, whose farmers are holding back the soybean crop to protect against the devaluation of the national currency due to elections in the South American country.

Trade war creates opportunities for Brazil

- Advertisement -

The purchase of Brazilian soy has increased since last year, when Beijing imposed retaliatory tariffs of 25% on US products.

In early May, US President Donald Trump announced that he planned to introduce new tariffs on Chinese products. As a result, as of May 10, US tariffs on a range of Chinese products were raised from 10% to 25% on goods worth $200 billion.

With Chinese interest in soybeans, Brazilian soybeans had a rise in prices , such as the port of Paranaguá, which had its October premium raised to 11%.

n turn, Ana Luiza Lodi, an analyst at INTL FCStone, said that Brazilian supplies available for shipment are limited, as the country’s stocks are low.

“Domestic consumption is strong amid higher demand for food,” said the analyst.

“If port premiums continue to rise, we will see further speculation that Brazil may import soybeans into local supplies in order to release its production for export to China.”

Noting that China usually buys Brazilian soy at this time of year, Asians have changed their minds and decided to buy loads of American soy as a gesture to ease the trade war between the two countries.

Last week, for example, Asians purchased approximately 135,000 tonnes of US soybeans, which is almost half the amount that should be shipped during this period.

Subscribe to our newsletter
Sign up here to get the latest news, updates and special offers delivered directly to your inbox.

Get real time updates directly on you device, subscribe now.

Comments