China is Busy Buying Brazilian Soybeans
China has purchased at least eight vessels of soybeans this week from Brazil
Reports Indicate China is Busy Buying Brazilian Soybeans
Market chatter is that China has purchased at least eight vessels of soybeans this week from Brazil.
This comes shortly after trade talks between the U.S. and China.
Daily sales announcements for China soybean purchases have slowed.
Without tariff waivers, U.S. soybeans likely are not competitive for China.
The latest FOB data show Brazil soybeans at a 34-cent premium to U.S.
FBN’s Take On What It Means: We believe this activity underscores that there still is work to be done between the U.S. and China with respect to trade discussions. State-owned firms in China (COFCO and Sinograin) are exempt from the 25% duties, but appear to have limited interest in purchasing U.S. soybeans despite the more competitive FOB price. Chinese buyers may also want to maintain solid relationships with Brazil exporters.
Argentina Wheat Needs Rain, Corn Planting Heating Up
Areas across Argentina’s wheat belt are in need of moisture.
Recent rains have not eased dryness concerns for wheat.
Wheat can still respond to moisture, but the window is narrowing.
Eastern Argentina received beneficial rains, helping advance corn planting.
Plantings are nearly 30 percent complete for the country.
However, rains would still be welcome and plantings are lagging last year.
There is producer concern about a different president being elected, which could deter corn plantings in favor of soybeans.
Elections are scheduled for later this month.
FBN’s Take On What It Means: If Argentina’s wheat crop falls shy of expectations, this could lend opportunities to U.S. wheat exports. On the corn side, there is risk Argentina could lose some area, pending the upcoming elections. Marci currently is in office, but there is a risk he will be voted out, which could be followed by changes to export taxes. This also would be supportive to U.S. corn exports, which have been suffering amid competition from Brazil and Argentina.
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