Soybean prices rose 1.6% after China decided not to impose tariffs on American soybeans

March soybean futures on the Chicago Board of Trade rose 1.6% to $395/t yesterday (+2.9% for the week and +7.8% for the month) as China decided not to impose tariffs on US soybeans. They are also supported by adverse weather conditions in South America.

 

In response to the Trump administration's 10% tariff on Chinese goods, China is imposing a 15% tariff on American coal and liquefied natural gas (LNG) on February 10, as well as a 10% tariff on oil, farm equipment, large vehicles and pickup trucks. However, Beijing has so far decided not to impose tariffs on American soybeans, which traders feared and lowered quotes.

 

The Ministry of Commerce of the People's Republic of China reported that China has already filed a complaint with the WTO against US tax restrictions.

 

The central and northern regions of Argentina continue to suffer from a prolonged drought that is reducing the potential for soybean harvests, but forecasts are promising rainfall this week.

 

In central and western Brazil, rains are delaying the soybean harvest and second-crop corn planting, and the intensity of rainfall is expected to increase next week.

 

According to AgRural, as of January 30, soybeans have been harvested in Brazil on only 9% of the area (16% last year), and corn has been sown on 9% of the area (27% last year).

 

Local agency Celeres raised its forecast for soybean production in Brazil by 3.2 million tons to 174 million tons, while StoneX, on the contrary, lowered its forecast by 0.51 to 170.89 million tons due to significant crop losses from excessive rainfall.

 

Quotes support the high pace of soybean processing in the US. In December 2024, the processing volume reached a record 5.93 million tons, and in total for the first 4 months of the 2024/25 MY amounted to 30.5 million tons, which exceeded the average for this period by 6.3%.

 

U.S. soybean exports for the week of January 24-30 rose 37% to 1.013 million tons, of which 348,000 tons were sent to China. In total, the U.S. exported 34.066 million tons of soybeans in 2024/25, out of a projected 49.7 million tons.

 

In Ukraine, export prices for GMO soybeans remain at UAH 18,100–18,400/t or $382–385/t delivered to Black Sea ports as demand for it falls as supply from South America increases. Processors are keeping prices low at UAH 17,200–18,000/t delivered to the plant amid weak demand for meal and difficulties with its sale.

 

The soybean market will remain influenced by weather conditions in South America in the coming weeks, which could provide speculative support to quotes. However, activity in the physical market will be low as buyers await the results of the record harvest in Brazil.