WASHINGTON, United States – US President Donald Trump urged China to quadruple its soybean purchases ahead of a deadline for a major tariff truce. This caused soybean prices to soar in Chicago. However, analysts were quick to question the viability of any such agreement.
In a late-night post on Truth Social, Trump said China was concerned about soybean shortages. He hoped China would quickly double its soybean orders from the United States.
Trump said in his post: “A quick service will be provided.. Thank you, Eleventh President.”
Chicago Mercantile Exchange (CBOT)’s most active soybean contract jumped 2.38% to $10.11 a bushel at 06:37 GMT on Monday after Trump’s post. The contract was stable earlier.
China, the world’s largest buyer of soybeans, imported nearly 105 million metric tons last year. Just under a quarter came from the United States, and most of the rest came from Brazil. Therefore, quadrupling shipments from China will require importing the bulk of soybeans from the United States.
“China is highly unlikely to buy four times its usual volume of soybeans from the United States,” said Johnny Xiang, founder of Beijing-based consulting firm Agradar.
The tariff truce between Beijing and Washington is scheduled to expire on August 12. However, the Trump administration has hinted at the possibility of extending it. It is unclear whether China’s approval to buy more American soybeans is a condition for extending the truce. This arises in light of Trump’s efforts to reduce China’s trade surplus with the United States.
China’s soybean futures fell 0.65% to 3,068 yuan per metric ton amid expectations that US imports may increase supplies.
Under the first phase of the trade agreement concluded during Trump’s first term, China agreed to increase its purchases of American agricultural products, including soybeans. However, Beijing did not achieve these goals.
Amid trade tensions between Washington and Beijing this year, China has yet to buy any US grain for the fourth quarter. This raises concerns as the US harvest export season approaches.
“On Beijing’s part, there have been numerous signals that China is ready to abandon American soybeans entirely this year. This includes booking test shipments of soym eal from Argentina,” said Even Rogers Bay, an agricultural analyst at Trivium China.
Reuters reported earlier that Chinese feed manufacturers purchased three shipments of Argentine soybeans. This was part of their effort to secure cheaper supplies from South America amid concerns about a possible disruption to soybean supplies in the fourth quarter.
The US soybean industry is looking for alternative buyers, but no other country can match China’s export volume. Last year, China imported 22.13 million tons of soybeans from the United States and 74.65 million tons from Brazil.
