China’s Soymeal Surges on Supply Worries as Beijing Retaliates

China’s soybean meal prices surged on the first day of trading after a holiday, as a renewed trade war between the world’s two largest economies threatened supplies.

Beijing on Friday hit back at Washington’s tariffs, imposing a 34% duty on all US imports from April 10. The hefty duties include soybeans and threaten to halt shipments of the oilseed to China from its second-largest supplier, and roil a trade that was worth more than $12 billion in 2024.

China had already announced a 10% tariff on soybeans and other farm products from the US last month, which was seen as a muted response to US President Donald Trump’s initial protectionist measures.

But this time, trade tensions have escalated, brokerage China Futures said in a note on Monday.

The latest round of tariffs has caused worries over future US soybean exports and that China’s import costs will be pushed up, the brokerage said.

The most actively traded soybean meal futures on the Dalian Commodity Exchange rose as much 2.7%, and hit their highest levels since September last year. Prices of rapeseed meal, a substitute to soybean meal in animal feed, also rose up to 2%. China’s corn futures were up nearly 1%.

Since the last US-China trade war during Trump’s first term, China has been diversifying grains imports to slash its reliance on American crops. The country has been buying more soybeans and corn from Brazil, which is now its top supplier, but the US remains a key source.

China has enough supply of soybeans in the next few months thanks to shipments from Brazil, the Wuhan branch of Cofco Futures said in a note. But the country will face competition from other buyers and higher costs, and supplies are expected to be tight from the fourth quarter, when US beans typically dominate the market, according to the note.

Tags: prices, soybean meal, rapeseed meal, China