Chinese agree to buy $5.3 billion worth of US soybeans

Chinese agree to buy $5.3 billion worth of US soybeans

Photo by Andrea Gantz

Deal involving more than 13 million metric tons of US soybeans believed to be largest single-day purchase in history

Chinese importers signed letters of intent to purchase more than 13 million metric tons of U.S. soybeans, valued at $5.3 billion, at a ceremony held in Des Moines, Iowa on September 24.

According to the U.S. Soybean Export Council (USSEC), 24 frame and sales contracts were signed between Chinese soybean customers and U.S. soybean exporters, including ADM, Bunge, Cargill and Louis Dreyfus Group.

“I think it’s safe to say that this is the largest single-day purchase ever,” Jim Sutter, president of USSEC, said during a USDA Radio News interview.

The large purchase of U.S. soybeans was welcome news, particularly as soybean purchases have been sluggish so far in 2015, possibly because potential buyers are waiting to see if soybean prices continue to drop. Nonetheless, Sutter is optimistic more purchases will follow in 2015.

“This is a great start, but last year their purchases from the United States were more than double than this amount, so we would suspect that they would have more subsequent purchases later in the marketing year as we go along.

USSEC Chairman Laura Foell, who welcomed the trade delegation to the ceremony, said the U.S. soybean trade volume to China has grown from 140,000 metric tons in 1995 to 30 million metric tons in 2014.