China’s Cofco snaps up US soybean cargoes ahead of trade talks

Chinese state-owned soybean crusher Cofco snapped up more than 10 cargoes of US beans Thursday, marking the largest daily purchase from the North American country in nearly a month despite frosty diplomatic relations between the two economic powerhouses, sources told Agricensus Friday.

Cofco reportedly contracted for 10-12 cargoes of soybeans primarily out of the US Gulf for shipment between October and November this year at prices of 219-222 c/bu over November futures on a CFR China basis, according to five different market sources.

The size of this purchase was equivalent to 650,000-795,000 mt of US soybeans, making it the highest daily volume contracted to China since July 14 this year when Cofco also bought as many as 12 cargoes in one day.

China’s total soybean purchases so far this week have already surpassed 40 cargoes, up significantly from 23 and 29 cargoes in the past two weeks, according to trade data tracked by Agricensus.

The latest purchases of US soybeans were made against the backdrop of souring US-China diplomatic ties that resulted in both countries shutting down consulates in each other’s territories recently.

Still, senior trade officials from US and China are set to meet next week to discuss the progress of Chinese purchases of US products under the phase-one trade agreement signed in January this year.

China has been contracting large volumes of US soybeans and corn in recent weeks to meet its pledge to buy $33 billion of US agricultural products under the trade deal.