Portuguese 
English 
Spanish 
4 min of reading 
2 comments 
The Slowdown of Chinese Purchases of Brazilian Soybeans, Driven by High Premiums and Trade Tensions, May Lead Beijing to Resort to State Reserves to Meet Demand While Awaiting the Arrival of the New South American Harvest.
China entered October without securing much of the soybean supply for December and January.
With high premiums for Brazilian soybeans and crushing margins in the red, traders say Beijing may turn to state reserves to cover immediate demand.
According to three market sources, there are still 8 to 9 million tons missing for shipment this bimonthly period, after large purchases from Argentina for delivery by November.
-
There are only four days left until the Income Tax deadline, and the Federal Revenue Service is still awaiting over 13 million returns. Those who miss the 11:59 PM deadline on May 29 will incur a minimum fine of R$ 165.74 with no discount.
-
More than 220 Brazilian industries have already fled towards Paraguay and no one seems to be paying attention. The small neighbor is growing three times faster than Brazil and attracting billions in foreign investments while the South American giant remains stagnant.
-
Government prepares billion-dollar discount on electricity bills: Aneel will return R$ 5.5 billion to consumers in the North, Northeast, Mato Grosso, Minas Gerais, and Espírito Santo in the form of reduced energy tariffs.
-
Starting June 7, 27 European countries prohibit asking about previous salary in interviews, and Brazil has chosen a different path.
The backdrop is the freeze on purchases from the United States amid escalating trade disputes.
State Reserves Come into Focus
Without a tariff agreement with Washington and faced with Brazilian offers considered “expensive” by buyers, the use of public stocks is back on the table.
A trader supplying grains to China summarized the halt: “China is not buying grain from the U.S. due to the trade war, and Brazilian soybeans are too expensive.”
According to him, the release of part of the reserves could occur “at the end of the year and the beginning of next year, until the arrival of the new South American harvest.”
Premiums in Brazil Stall Business
The differentials paid for Brazilian loads remained between US$ 2.8 and US$ 2.9 per bushel over the November contract in Chicago, compared to around US$ 1.7 per bushel for U.S. offers.
In this scenario, Chinese crushers have little motivation to secure shipments for December and January, as Brazilian origins compress margins that have been negative for most of the second half.
An operator in Shanghai described the appetite as “weak,” while the market awaits signs of relief in costs.
Argentina Gains Ground in the Short Term
To cover the upcoming weeks, Chinese buyers have increased orders from Argentina, benefiting from momentarily more competitive trade conditions.
Since the end of August, market reports have indicated additional lots also from Uruguay, a movement that helps to address the flow of arrivals until November.
At least 2.43 million tons of soybeans from Argentina and Uruguay are said to have been secured for shipment between September and May, according to consulted operators.
U.S. Out of the Game and September Without Shipments
Trade with the United States remains stalled.
In September, China did not import a single ton of U.S. soybeans, a situation not seen since 2018, according to the latest data.
During the same period, the country’s total purchases were supported by South American supply, with Brazil accounting for the dominant share.
The blockage of U.S. shipments occurred amid tariffs and new tensions between the two governments.
Meanwhile, political rhetoric has intensified.
On Tuesday, U.S. President Donald Trump accused Beijing of “deliberately” avoiding soybean purchases, calling the action an “economically hostile act” that has brought difficulties to U.S. producers.
The issue is expected to come up in a scheduled meeting in South Korea between Trump and President Xi Jinping, although Beijing has not yet publicly confirmed the conversation.
Window for Reapproachment Remains Open
Even with the impasse, Chinese processors are not completely dismissing U.S. supplies if a trade agreement arises.
For consultant Johnny Xiang of AgRadar Consulting, if there is an understanding between the governments, purchases for December and January are likely to shift to the U.S., “with prices more attractive than South American offers” during that period.
This assessment is circulating among traders and analysts as a conditional scenario, dependent on bilateral political gestures.
New Brazilian Harvest May Ease Prices
On the supply side, the expectation is for a record harvest in Brazil in 2025/26.
The state agency Conab projects 177.64 million tons, about 6 million above the previous cycle.
With favorable weather, parts of the Midwest may start shipments at the end of January, shortening the Chinese off-season and potentially reducing premiums.
Until then, however, high costs at the Brazilian origin are likely to continue limiting closures for December and January.
U.S. Share Has Shrunk Since 2016
The restructuring of China’s supplier mix is not new and has intensified since Trump’s first term.
In 2016, the United States accounted for 41% of China’s soybean purchases.
By 2024, that share has fallen to about 20%, according to customs data.
The shift has resulted in greater prominence for Brazil and, more recently, in sporadic surges of shipments from Argentina.
In 2025, dependence on the Southern Cone became even more apparent.
Pressed Margins and the Pace of Closures
The negative crushing margins help explain the buyers’ waiting game.
When the cost of raw material rises above the return from meal and oil, the industry reduces its appetite for futures contracts, pushing decisions to the “last minute” and favoring momentarily cheaper origins.
In this environment, high premiums tend to correct only with greater physical availability — which, in the operators’ view, depends on the arrival of the new Brazilian harvest in early 2026.
Notícia plantada, quem pagou ?? Quanto pagou??
Every time I visit your website, I’m greeted with thought-provoking content and impeccable writing. You truly have a gift for articulating complex ideas in a clear and engaging manner.