In a break from the trade war, China made its third purchase of U.S. soybeans in a week, said the USDA on Wednesday. The purchases followed a meeting between President Trump and Chinese President Xi Jinping in Buenos Aires that Trump said would result in significant exports to China even as efforts to resolve trade disagreements between the two countries continued.
The latest soybean purchase, 1.199 million tonnes, boosts the one-week total to 2.63 million tonnes, or 96.6 million bushels. The purchases are a fraction of the normal flow of soybeans to China and come at a time when the U.S. soybean harvest has hit a record of 4.6 billion bushels. China used to buy 1 of every 3 bushels of U.S. soybeans but has now turned to Brazil to meet its needs. Analysts are uncertain if China will return as a major U.S. customer or will again look to Brazil when that country’s new crop reaches the market in early 2019.
U.S. soybean exports to China are running at just 2 percent of last year’s pace, according to an American Farm Bureau Federation analysis of the USDA’s weekly Export Inspections report. Overall, U.S. soybean exports are 42 percent lower than at this point a year ago. Argentina, Spain, and the Netherlands are the top customers at the moment. Argentina is one of the world’s largest soybean growers, but bad weather has cut its current crop by nearly one-third.