There are a lot of confusing numbers when you talk about where the U.S. stands in terms of soybean imports or exports to China. As far as where we stand today, there are a lot of confusing numbers. Some are at zero, some at four million metric tons, and some at seven million metric tons. Iowa State Agricultural Economist Chad Hart talked about the numbers he is relying on.
“So, in this case, I would say they’re all technically correct, which, as an academic, we always love. But here’s the deal: how do you get a zero right now? Well, if you look at the Chinese data as far as U.S. beans that have hit their shores, we’re still at zero. When I look at the weekly export sales data that the USDA is catching back up on, that would show that China has purchased about four million metric tons thus far, and while those haven’t hit the shore yet, they will be moving along that way. And for those eagle-eyed observers that have been tracking the daily sales that are reported under USDA’s system, you could get yourself up to about that seven million metric ton level because we have been seeing China being active, especially here in late November, early December, and those data will eventually show up in the weekly sales data, probably within the next couple of weeks.”
He said that it will also show up in the Chinese data within the next month or so. Hart talked about how the market seems to be viewing the soybean sales data.
“I think as you look at it right now, it was one of those deals where we really traded up the rumor, and then bid down the news. So, the idea is we saw the rally before any purchases were made, but when the agreement was sort of announced, and now with each resulting sale, the market’s sort of discounting that along the way. And I think it’s because the market is sitting here going, ‘There’s been an agreement, the agreement seems to be being held up here, but it also puts us still in a position to, you know, China agreed to purchase 12 million metric tons here for 2025, but that would still only be about half of what they usually do.” And so, hence the let’s call it, lack of excitement.”
He said the marketplace has turned its collective gaze toward the Brazilian and Argentine crops.
“It pretty much has. It’s also looking to see whether we will see China go beyond what they agreed to, and I think they’re betting right now the answer is no, because of what we see coming out of South America, that when you’re looking at global soybean supplies, while that total global number is smaller this marketing year, it’s not necessarily the case when we look at South America. That we continue to see Brazil growing by leaps and bounds there, and therefore keeping downward pressure on soybean prices because no matter what we say about this deal with China, we do know that they usually have a clause in there that says, ‘Hey, they can move to the Brazilian market if they find better prices there.’”