Soybean growers in Argentina are playing a waiting game, wagering on better prices ahead as the U.S. and China inch toward a trade deal and as nation’s currency keeps depreciating. Farmers on the Pampas arable belt have signed delayed-price contracts for almost three quarters of the 12.2 million metric tons they’ve sold to crushers and exporters so far, according to government data. That compares with 60% at the same stage last year.
China’s purchases of U.S. soybeans have come to a grinding halt, trade and industry sources say, as fears of further action by Beijing to curb imports of U.S. crops following last week’s anti-dumping move on sorghum rattles the agriculture industry.
Argentina, the world’s third biggest soy producer, booked its largest purchase of U.S. soybeans in 20 years on Tuesday after drought cut its harvest, forcing crushers there to turn to imports. The surprise move pushed Chicago soybean futures to a one-month high, in the latest development to upend global soy trading after top buyer China last week proposed tariffs on U.S. imports amid an intensifying Washington-Beijing trade dispute.
The U.S. Department of Agriculture sees U.S. corn and soybean exports generally increasing over the coming decade but the U.S. share of global sales will shrink as competition from South American producers heats up, the government said in its annual report.