US share of China soy demand slumps as buyers head to Brazil

The US share of Chinese soybean demand in the first month of 2018 fell to its lowest level for years, with US farmers taking a 68% share of exports versus 88% a year earlier and 81% in 2016, according to detailed figures from China Customs released over the weekend.

Of the 8.5 million mt China imported, the US supplied 5.8 milliont mt versus Brazil supplying 2 million mt, which equated to a 24% market share.

The move highlights the impact of a bumper Brazilian harvest, which last January supplied China with just 3.3% of beans.

China is the world’s biggest importer of soybeans, buying approximately two-thirds of the 150-million mt beans that are traded internationally every year.

Typically, US suppliers dominate the soybean market in December as the month lands in their peak selling season as most Brazilian farmers that compete are planting their fields.

However, last year Brazil produced over 114 million mt of beans, up almost 20% on a year earlier, which meant they were still shipping soybeans in December with cargoes landing in China in January.

This year, the harvest is expected to be just as big.

The reduction in China’s dependence on US soybeans comes at a time when the two nations are involved in a trade dispute.

Earlier this month China said it was launching an investigation into whether US imports of sorghum were dumped just weeks after the US slapped taxes on imports of solar panels and washing machines.

Farmers fear soybeans may be next in China’s crosshairs after reports emerged that it was investigating the impact of tariffs on US beans.