After Trade Talks In U.S. China Ramps Up Brazilian Soy Purchases

(Reuters) Karl Plume Hallie Gu October 18 2019 6:57 AM CHICAGO/BEIJING - Chinese importers have been busy booking fresh purchases of soybeans from Brazil this week despite the White House announcement that China had agreed to buy up to $50 billion (38.6 billion pounds) of U.S. farm products annually during trade talks last week. The purchases from Brazil rather than the United States show that Chinese buying has been driven more by price than policy since last weeks preliminary trade agreement that U.S. President Donald Trump hopes will be signed next month. Anticipation that Chinese buyers would return to the U.S. market to make big purchases in the wake of the deal drove benchmark U.S. soy prices last Friday to their highest levels since the start of the trade war more than 15 months ago. The rally in U.S. prices last week however made Brazilian soy more of a bargain for Chinese buyers. Brazilian soy is even more appealing to commercial importers because a 25 duty on U.S. shipments remains in effect and Beijing has not awarded the non-state-owned firms any new tariff waivers. Since Monday two traders said China has booked at least eight boatloads or 480000 tonnes worth $173 million of Brazilian soybeans. While Brazil is Chinas largest soybean supplier large purchases from South America are unusual at this time of year with the U.S. harvest coming in. Benchmark U.S. prices posted their first weekly decline in three weeks as Chinese buying failed to materialize in the U.S. market. Trump said on Twitter on Sunday that China has already begun making U.S. agricultural purchases. But three U.S. soybean exporters said there have been no U.S. sales to China since last weeks talks in Washington and none have been confirmed by the U.S. Department of Agriculture.