China set a record with a purchase of 2.92 million tonnes of US soyabeans, reported by exporters on Friday, two days after a Chinese delegation signed agreements in Iowa to buy millions of tonnes of the oilseed. The agreements were signed during a visit by Chinese Vice President Xi Jinping. China is the world's largest importer of soyabeans and regularly buys one-fourth of the US crop.
Almost all of the soyabeans in the record sale, 2.75 million tonnes, would be delivered in the marketing year that opens on September 1. Drought has damaged the South American soya crop, so US supplies will be more vital to importers. The sale was worth $1.36 billion, based on current prices. The previous record for the largest sale of US soyabeans was 2.74 million tonnes, also to China, on January 27, 2011, according to data from the US Department of Agriculture.
"These are big numbers and it tells you the seriousness of China pricing," said Don Roose, analyst and president of US Commodities in Des Moines, Iowa. He added: "That is a big number for a new-crop bean sale". Roose said the waning soyabean crop prospects in South America and the China buying could lead to a 10 to 15 cents per bushel higher open on Friday for Chicago Board of Trade soyabean futures.
On Wednesday, a Chinese trade delegation signed agreements in Iowa to buy 8.62 million tonnes of US soyabeans, worth $6 billion. China is the No 1 market for US farm exports with purchases that totalled $20 billion last year. Sales are forecast to be slightly lower this year due to weaker commodity prices. China buys 60 percent of soyabeans on the world market and nearly half of the cotton traded internationally. Analysts believe it will become a sizeable corn importer in the near term.