During this week, Chinese importers have signed contracts to purchase more than 2.4 million tons of soybeans from Brazil, taking advantage of the decrease in prices for Brazilian sunflower oil. Previously, these prices were rising due to the escalation of the trade conflict between China and the USA. This information is reported by OleoScope, citing Bloomberg data.
It is specified that the contracted soybeans are mainly supposed to be delivered in May, June, and July, comprising about a third of the monthly sales volume for this period of the year. Chinese buyers have also shown interest in increased margins for processing in the domestic market, especially after the sharp increase in prices for soybean meal due to concerns related to the trade war between the USA and China.
However, analysts note that Brazilian soybeans may become more expensive if tension in trade relations between the USA and China remains high. Supply shortages may occur in the fourth quarter, when China usually prefers to purchase the new crop from the USA. Therefore, Chinese processors will have to acquire more raw materials during the period of price decline.