China to buy 12 million metric tons of US soybeans this season, Bessent says
[CHICAGO] US Treasury Secretary Scott Bessent said on Thursday that China has agreed to buy 12 million metric tons of American soybeans during the current season through January, down from 22.5 million tons in the prior season after a months-long tariff battle halted all purchases of the current US harvest.
China also committed to buying 25 million tons annually for the next three years as part of a larger trade agreement with Beijing, Bessent said, following a meeting between US President Donald Trump and Chinese President Xi Jinping in South Korea.
The drop in Chinese demand cost US farmers - a key pillar of Trump’s political base - billions of dollars in lost sales and the deal would represent a return to normalcy in trade with the top US soy importer, which averaged purchases of 28.8 million tons over the past five September-to-August crop seasons.
“Our great soybean farmers, who the Chinese used as political pawns - that’s off the table, and they should prosper in the years to come,” Bessent told Fox Business Network’s Mornings with Maria programme.
The agreement negotiated in Malaysia over the weekend could be signed as soon as next week, he said.
Bessent said other countries in South-east Asia have agreed to buy another 19 million tons of US soybeans, but did not specify a timeframe for those purchases or the nations involved.
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Asian importers other than China have imported between 8 million and 10 million tons annually in recent years, according to US Census Bureau trade data.
The most-active soybean contract on the Chicago Board of Trade reversed losses and closed 1.2 per cent higher at a 15-month high of US$11.07-3/4 per bushel.
US soybean export prices jumped by US$20 to US$30 per metric ton this week as exporters anticipated the Trump-Xi meeting would spark fresh demand. Three soy cargoes, or about 180,000 tons, were sold to Chinese state-owned importer COFCO on the eve of the summit.
“These (Chinese purchase agreements) are not numbers that are unattainable, but they’re also not numbers that are really supporting the idea of expansion for our US soybean export programme,” said Ted Seifried, chief market strategist for Zaner Ag Hedge.
Relief in US farm belt
US farm groups cheered the agreements after Trump’s bruising trade war eroded soy exports valued at US$24.5 billion last year. Growers have nearly finished harvesting what is expected to be the fifth-largest US crop on record. The lack of Chinese demand has squeezed US farm incomes as crop prices hovered near multi-year lows for months amid rising costs for fertiliser, seeds, labour and equipment.
“This is a meaningful step forward to reestablishing a stable, long-term trading relationship that delivers results for farm families and future generations,” said American Soybean Association President and Kentucky farmer Caleb Ragland.
The agreement with China came after Trump secured agricultural trade deals or framework agreements with other Asian nations.
“Expanding markets and restoring purchases by China will provide some certainty for farmers who are struggling just to hold on,” said American Farm Bureau Federation President Zippy Duvall.
China diversifying soybean purchases
Trump wrote in a social media post overnight after his meeting with Xi that the Chinese leader had authorised China to begin the purchase of massive amounts of soybeans, sorghum and other farm products.
US Agriculture Secretary Brooke Rollins applauded Trump’s comments on soybeans and sorghum in a post on X.
But Even Rogers Pay, director at Beijing-based Trivium China, said the agreement effectively constituted a return to business as usual in terms of US soybean exports to China.
“It targets a level of trade that has been pretty consistent with the past few years,” she said.
Johnny Xiang, founder of Beijing-based AgRadar Consulting, said commercial buyers were still awaiting details such as whether China would reduce the tariff on US soybeans from 20 per cent to 10 per cent, or remove it entirely.
“If the tariff is not completely lifted, commercial buyers will have little incentive to purchase US soybeans,” he said.
China, the world’s biggest soybean buyer and the top market for US farmers, had turned its vast appetite for US crops into a powerful trade war bargaining chip.
Facing import duties of 23 per cent on soybeans after rounds of tit-for-tat tariffs, Chinese buyers largely shunned the US autumn harvest, turning instead to South American supplies.
Since the trade war of the first Trump administration, China has diversified its sources of soybean imports. In 2024, China bought roughly 20 per cent of its soybeans from the United States, down from 41 per cent in 2016, customs data shows. REUTERS
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