Soybean futures slipped below $13 per bushel, the lowest level in more than two weeks, yet remained close to the 3-1/2-year high of $13.30 reached on September 10. The market was in a holding pattern as traders awaited evidence that the US-China agreement to reduce tariffs on roughly $30 billion of imports from each side would translate into stronger Chinese demand for US soybeans.
China’s tariff cuts apply to a range of agricultural products, including corn, wheat, sorghum, meat, seafood and fresh produce, and the two countries also agreed to establish an agricultural working group. However, soybeans were notably excluded from the deal, apart from seeds, leaving US soybean exports to China still subject to an effective tariff of around 13%.
China has already purchased more than half of its annual pledge to buy 25 million tons of US soybeans, but progress on a separate $17 billion agricultural purchase commitment remains limited. In the near term, ample global supplies, soft domestic demand and ongoing disruptions to Black Sea grain flows could further restrain Chinese import volumes.
