With the escalation of trade frictions between China and the United States, China is trying to impose a 25% tariff on soybeans imported from the United States.The battle is quietly reshaping the global soybean trade flow.South American countries such as Brazil, a major importer of Chinese soybeans, want to increase exports to China, while U.S. soybeans will increase exports to the European Union in the near term.
In 2017, China imported about 95.53 million tons of soybeans.Brazil, the United States and Argentina account for about 53 percent and 34 percent of China's total imports of soybeans from Brazil and the United States, respectively.Citing Brazilian media reports, People's Daily said U.S. soybeans are not irreplaceable and that South American countries such as Brazil, Argentina and Bolivia are highly competitive.
Brazil is the world's second largest producer and largest exporter of soybeans, and the gap with the United States has narrowed in recent years.Brazilian economist Roberto Damase said in an interview with People's Daily that Brazil will harvest about 113 million tons of soybeans in the coming year, and that China's soybean import demand is close to 100m tons.It can be predicted that Brazil's soybean exports to China will continue to grow momentum.Maurizio Santoro, head of international relations at Rio State University in Brazil, said that China has been Brazil's largest trading partner since 2009 and that Brazil is looking forward to expanding its exports of agricultural products such as Chinese soybeans.
China also wants to increase imports of Brazilian soybeans.But Jack Scoville, analyst at Price Futures Group, said political factors had pushed up the price of Brazilian soybeans.According to Reuters local time on April 8, at a time when Brazilian soybeans are at a stage of harvest, the price should be lower than that of US soybeans, but Chinese importers are worried that soybeans purchased from the United States may be subject to high tariffs.So step up the purchase of Brazilian soybeans, Brazilian soybean export prices to record high.
Soyabean prices in Brazil were about $2 a bushel higher than the CBOT May contract, before retreating to $1.7 a bushel at the weekend, soybean traders said.By contrast, soyabean shipments off the U.S. Gulf Coast are only $0.90 a bushel higher than CBOT soyabean futures.
"Brazilian soybeans may be shipped to China in the short term, and soyabean supplies are available in the United States," said Jim Sutter, chief executive of USSEC, the U.S. Soybean Export Association.