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Soybean exporters in the U.S., the world’s top shipper, sold 2.923 million metric tons to China in the biggest one-day deal on record. Prices in Chicago rose to the highest in almost five months.
The sale includes 2.75 million tons for delivery in the year that begins Sept. 1 and 173,000 tons prior to Aug. 31, the U.S. Department of Agriculture said today in a statement. China is the largest oilseed importer and the biggest buyer of U.S. agricultural products.
U.S. and Chinese officials yesterday signed a five-year accord to cooperate on agricultural production and trade and food security. This week, China signed agreements in Iowa to purchase 8.62 million tons of soybeans as Chinese Vice President Xi Jinping visited the state. The Asian nation purchased $22.17 billion of U.S. farm products last year, helping to boost total exports to a record.
“No doubt those were whopper sales,” Don Roose, the president of U.S. Commodities Inc. inWest Des Moines, Iowa, said in a telephone interview. “With the Chinese in town, there’s something to that.”
Cargill, ADM Sales
Companies including Cargill Inc. and Archer Daniels Midland Co. signed contracts on Feb. 15 to export $4.3 billion of soybeans to China. U.S. Agriculture Secretary Tom Vilsack, who met with Xi and Chinese farm minister Han Changfu in Iowa during their visit this week, said the sales highlight a strong relationship he expects will expand.
“I have a good relationship with the Chinese agriculture minister, and I think these discussions will bring progress later” on boosting sales of soybeans and other products, including some U.S. beef cuts currently banned in the country, Vilsack said.
Soybean futures for May delivery rose 0.7 percent to close at $12.7375 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price reached $12.795, the highest for the most- active contract since Sept. 23.
“Agriculture has become one of the highlights in U.S.- Chinese relations,” Han said yesterday at a symposium in Des Moines. “Agriculture has had a huge benefit on both countries.”
The U.S. is the largest exporter of agricultural products. China, the most-populous country, bought $10.5 billion of the U.S. soybean crop last year, 29 percent of total production, according to USDA data.
Global soybean consumption has soared in the past decade, fueled by economic growth in China, India and Brazil that boosted incomes and demand for vegetable oil used in fried and baked foods, candy and breads. People also are eating more meat, increasing the need for the oilseed to make livestock feed.
Source: Bloomberg
