China passes halfway point of U.S. soybean purchase promise
A worker handles soybean meal at a crushing factory in Harbin, China. (Andrea Verdelli/Bloomberg)
Key Takeaways:
- China has purchased nearly 13 million tons of U.S. soybeans this season, exceeding half of its 25 million-ton annual pledge.
- The rebound has lifted soybean prices to their highest since 2023 and boosted American farmers before harvest.
- Xi Jinping and Donald Trump plan to meet in late September as continued Chinese purchases remain key to sustaining the rally.
China has fulfilled more than half of its annual U.S. soybean purchase pledge, offering a bright spot for trade between the world’s two largest economies ahead of President Xi Jinping’s visit to Washington.
State-owned traders booked at least 1 million tons of U.S. soybeans last week, according to people familiar with the matter, who asked not to be named as they’re not authorized to talk to the media. That has brought total purchases for the current season close to 13 million tons, the people said, more than half of the 25 million-ton annual target Washington says Beijing has committed to through 2028.
The target is part of a wider trade truce struck between the two sides last year. The deal helped drive a rebound in crop flows, which largely stalled at the start of President Donald Trump’s latest term due to a blitz of tariffs between the countries.
Xi and Trump are preparing to meet in late September in the U.S. for a closely watched trade summit, their second this year. China has also pledged to buy at least $17 billion of U.S. agricultural products on top of the soybean purchases, with the figure prorated for 2026, the White House said in May.
The US Department of Agriculture last week reported more than 600,000 tons of soybean sales for delivery to China in the 2026-27 marketing year. No sales were reported Monday.
Soybean futures in Chicago rose as much as 1% Sept. 14, rebounding after steep losses last week.
The recent ramp-up in exports has helped bring soybean prices to the highest since 2023, giving American farmers a boost just ahead of harvest. Meanwhile, increased biofuel blending requirements in the U.S. and elsewhere have also raised demand for domestic processing.
Continued purchases will be needed to sustain the rally, said Joe Davis, a director of commodity sales at Futures International. Longer-term trade prospects also remain clouded as tensions between the countries flare over other issues, from competition over artificial intelligence to arm sales to Taiwan.
USDA data showed shipments of American soybeans accelerating to the most since April in the latest week, with China the top destination.
The exports are an “encouraging sign as we shift towards fulfilling the growing sales book for the fall period,” StoneX analyst Mike Castle said in a note.
Separately, in its September report Sept. 11, the USDA raised its soybean production and yield estimates, defying analysts’ expectations for cuts.
CHS Inc., the biggest farm cooperative, earlier Sept. 14 announced plans to build a $700 million soy crushing plant near Evansville, Wis., with construction expected to start this year and completion targeted for autumn 2028. The company said strong demand and a friendly policy environment “reinforce the need for additional soybean processing capacity in the U.S.”
CHS ranks No. 27 on the Transport Topics Top 100 list of the largest private carriers in North America.