China’s soybean imports in April jumped 18% from a year earlier, reaching a record high of 8.57 million metric tons for the month, according to data from the General Administration of Customs. This surge was driven by Chinese buyers snapping up cheap and plentiful Brazilian beans as the South American producer wrapped up its harvest season.
The rise in soybean arrivals was also attributed to stronger soymeal demand for animal feed, as profit margins at hog farms improved. Additionally, Chinese buyers opted for lower-priced Brazilian supplies compared to shipments from the U.S. Gulf of Mexico.
“April’s imports also rose as Chinese buyers opted for lower priced Brazilian supplies,” said Liu Jinlu, an agricultural researcher at Guoyuan Futures. He noted that prices for Brazilian soybean for delivery to China in June to August are between $505 and $518 a ton on a cost and freight basis, while shipments from the U.S. Gulf of Mexico for those three months are $536 on a cost and freight basis.
Liu expects that soybean arrivals in May and June will average 11 million tons. However, recent torrential rainfall and heavy flooding in Brazil’s second-largest soybean-growing state, Rio Grande do Sul, have disrupted the final stages of the harvest and hampered the shipping of grains to port, clouding the supply outlook.
The potential crop damage in Brazil has bolstered Chicago soybean futures prices. Meanwhile, U.S. soybean exports to China, which have been declining for several years as Brazil builds its dominance in the world’s biggest oilseed market, face more competition in 2024 from higher supply in Argentina, the world’s third-largest producer.
China’s imports of vegetable oils in April were 494,000 tonnes, down 17.7% from the previous month, the customs data showed.