China bought soybeans from the United States on Tuesday, 1st March as American cargoes were competitive against Brazilian shipments, despite it being the peak period for South American soy export.
China booked at least five cargoes, around 300,000 tonnes, of U.S. soybeans for shipment in April-May, according to an Asia-based trader with knowledge of the deal.
The U.S. Agriculture Department confirmed on Wednesday that private exporters had reported the sale of 198,000 tonnes of soybeans to China, the world’s top importer of the oilseed, and 198,000 tonnes of soybeans to unknown destinations for delivery in the 2021/22 marketing year that ends Aug. 31.
While the five cargoes were old crop beans, China also booked a few American new crop soybeans that will be available from September, according to the trader, who declined to be identified as he was not authorized to talk to media.
USDA also reported sales of 68,000 tonnes of soybeans to China and 66,000 tonnes of soybeans to unknown destinations for 2022/23.
Physical crush margins for U.S. Gulf beans for delivery in April-May were around 500 yuan ($79.19) per tonne, according to data from Mysteel, a China-based consultancy.
“(Margins) are pretty high. Whoever has beans would make a fortune,” said another trader based in northern China, who was not among the three sources who confirmed the buying.
“China has been turning to the U.S. since after the Lunar New Year holiday. While prices of U.S. and Brazil beans were almost the same, logistics for U.S. cargoes were faster,” said the trader, who also declined to be identified as he was not authorized to talk to the media.
China’s soybean meal prices soared to record highs last month amid tightening supplies, and as bad weather cut crop size estimates and delayed exports in Brazil, the world’s top exporter.
Meal and soybean oil prices in China got another boost following the war between Russia and Ukraine, two major grain and edible oil exporters, which has disrupted world agricultural supply chains and sent global prices rallying.