Market doubts China’s ability to meet commitments on US soybean purchases

Most market participants believe China will fail to meet its procurement targets in the short term, and many doubt it will fulfill them over the full three-year period.

Since the United States and China signed a trade “framework” agreement on October 30, there has been active debate over whether China will honor its pledge to purchase 12 million tonnes of U.S. soybeans in 2025 and 25 million tonnes annually from 2026 to 2028.

Market participants largely agree that China is unlikely to meet the purchasing plan in the near term, and many question whether it will be achieved at all over the three-year horizon.

Reports indicate that six cargoes of U.S. soybeans are currently loading or awaiting loading this week at U.S. Gulf ports for shipment to China, with a seventh already en route. This marks the first delivery of U.S. soybeans to China since spring. Earlier this year, U.S. soybean futures fell to nearly five-year lows amid a lack of Chinese buying.

Over three days during the week of November 16, China purchased 1,584,000 tonnes of U.S. soybeans for delivery in the MY 2025/26, the largest weekly purchase in more than two years. In total, China booked 2,151,000 tonnes for November for delivery in the 2025/26, including a “good-faith” purchase of 100,000 tonnes made on October 30.

The surge in sales lifted U.S. soybean futures and triggered domestic sales, as U.S. farmers had been holding back new-crop supplies due to low prices. However, total sales remain well below the 12 million tonne target, with less than a month left in the calendar year.

Despite the resumption of Chinese buying, which many view as limited in scale, doubts persist over whether China will meet its commitments over the next three years. China has not confirmed the details of the trade agreement announced by the Trump administration in late October. U.S. President Donald Trump said the 12 million tonne commitment would be met by spring, contradicting an earlier statement by Agriculture Secretary Brooke Rollins, who said it would be achieved in 2025.

“Based on their history, I would say no,” said Arlan Suderman, Chief Commodities Economist at StoneX Group Inc., when asked whether China would meet its 12 million tonne purchase commitment in 2025. “They will buy enough to create the appearance of activity.”

According to Suderman, the market expects sales of 8–10 million tonnes in 2025, though volumes could end up closer to 3–3.5 million tonnes.

“We need the full 12 million to reach the U.S. Department of Agriculture’s target,” he said, adding that fulfilling the three-year commitments also appears unlikely.

In its November 14 World Agricultural Supply and Demand Estimates (WASDE) report, the USDA forecast total U.S. soybean exports in the MY 2025/26 at 1.635 billion bushels (44.5 million tonnes), down 50 million bushels, or 13%, from 2024/25.

Suderman also noted that China lacks sufficient storage capacity to meet its commitments for U.S. soybeans on top of volumes it has already purchased. This would require China to cancel some Brazilian sales, which would likely be absorbed by other buyers, still weighing on U.S. export demand.

Some industry participants believe the United States will be in a weaker negotiating position in 2025 than in 2018/19, when Trump’s first tariff war with China began, with soybeans at its center. China’s failure to confirm the agreement details and the possibility that volumes could be revised over the three-year period are fueling industry concerns.

Brazil remains a key challenge. It has ample soybeans available for sale to China and continues to expand production. Brazil’s new soybean harvest will begin in late December and accelerate through January, boosting export shipments, while the U.S. soybean export window is expected to close by the end of the first quarter.

According to trade sources, Brazilian soybeans are priced below U.S. supplies, and even China’s recent purchases of U.S. soybeans could have been sourced more cheaply from Brazil. This is another reason many market participants expect China to fall short of its commitments to the United States.

USDA forecasts Brazilian soybean exports in the 2025/26 MY at 112.5 million tonnes, up 9% from 2024/25.

During the government shutdown, USDA export sales reports were released with delays, with reports published through late October, leaving gaps in sales data. However, weekly export inspection data continued to be released and remained current throughout the shutdown.

As of November 27, 2022, soybean export inspections for the current marketing year totaled 11,867,705 tonnes, down 46% year on year, indicating weaker sales to China. By comparison, wheat export inspections were up 20% year on year, while corn inspections surged 71%.

Tags: China, soybean, USA