Source: Ukragroconsult (Ukraine)
China is anticipated to increase its soybean imports in the second quarter of 2025, alleviating a supply deficit that arose from reduced imports in March. According to five analytical and trading firms, purchases of soybeans between April and June are projected to reach 31.3 million tons, reflecting a 4.6 percent increase compared to 29.91 million tons imported during the same timeframe in 2023. The majority of these soybeans are expected to originate from Brazil, where a record harvest is predicted this year.
The shortage of this essential raw material has been attributed to delays in shipments from Brazil and the reluctance of Chinese buyers to purchase U.S. soybeans amid potential trade conflicts between Beijing and Washington. Consequently, some soybean processing companies have been compelled to halt operations temporarily. Cheang Kang Wei, the vice president of StoneX in Singapore, noted that Chinese firms are proactively sourcing new soybean crops from Brazil, which helps to offset the lack of U.S. supply.
The market dynamics have been further complicated by the Chinese government’s recent move to tighten quality standards for imported soybean shipments, leading to holdups in customs clearance and delays in deliveries to processing facilities. As a result, soybean inventory levels plummeted to a five-year low in March. Consultancy firm Mysteel reported that soybean stocks at Chinese ports on March 7 were merely 4 million tons, a decrease of 600,700 tons compared to previous levels.
Chinese producers have refrained from purchasing U.S. soybeans due to concerns over the potential for a worsening trade war with the United States. To exacerbate the situation, Beijing enacted new tariffs on agricultural imports from America last week, amounting to $21 billion, which further complicated market conditions. This has led to a reduction in domestic soybean stocks and a consequent scarcity of meal.
Analysts indicate that the shortage of soybeans has greatly affected feed producers, leading to a rise in meal prices. Nevertheless, it is anticipated that the soybean deficit will begin to diminish in April as supplies from South America resume, potentially exerting downward pressure on the prices of soybean products.
The significant decline in soybean shipments during March can be attributed not only to ongoing trade conflicts between the US and China but also to delays in logistics. Numerous vessels transporting Brazilian soybeans were delayed in ports, which worsened the existing shortage.
In summary, while the market situation remains challenging, analysts predict an increase in soybean imports by China in the second quarter, which may contribute to the stabilization of supply and prices of soybean products. However, any further changes will hinge on geopolitical dynamics, particularly the trade relationship between China and the US.