US soybeans, one of the first victims of the simmering trade war between China and the US, are finding willing buyers elsewhere, according to a recent USDA report.
China, the world’s largest importer of soybeans, recently slapped retaliatory tariffs on soybeans from the US.
To cover the shortfall, Chinese buyers have been gobbling up more of Brazil’s soybean exports, but at the same time, crowding out buyers from other countries.
Those buyers, it appears, are looking to source cheaper products from the US.
According to the USDA, that means US trade opportunities for markets outside of China would rise by nearly 13 million tons in 2018 compared with 2017. In contrast, increased purchases of Brazilian soybeans by China would result in an eight-million-ton decline in potential US and other exporter trade to China for the same period.
Brazil is now the top soybean supplier to China, shipping almost 60 million tonnes, up from 54.4 million tonnes year-on-year.
The share of Brazil’s exports destined for China rose to 85% in August, up 7% from September following the implementation of duties on US soybeans.
This has resulted in higher prices for Brazilian soybeans that have discouraged purchases by importers other than China, said the report.