Soybean futures are rallying to kick off the trading week after the US government reported that China is purchasing domestic agriculture again. This is great news for an industry that has been decimated since the White House engaged in a bitter trade dispute with China. Can US soybean keep up the upward momentum?
March soybean futures rose $0.475, or 0.52%, to $9.185 per bushel at 16:54 GMT on Monday on the Chicago Board of Trade (CBoT). Soybean prices have rebounded over the last month, advancing nearly 4% and potentially bottoming out at the end of September.
In the aftermath of the G20 summit in Argentina, President Donald Trump and President Xi Jinping announced a 90-day trade truce between the world’s two largest economies. The agreement involved Washington postponing hikes to tariffs and Beijing to buy more US agriculture and slash automobile tariffs. It looks like the temporary suspension on the trade war is paying off.
Reuters reported last week that Chinese
USDA Deputy Secretary Steve Censky said at an Iowa Soybean Association annual meeting that the figures are great but more work needs to be done:
Having a million,
million-and-a-half tonnes is great, it’s wonderful, it’s a great step.But there needs to be a lot more as well, especially if you consider it in a normal, typical year, we’ll be selling 30 to 35 million metric tonnes to China.
Historically, China has been the biggest buyer of US soy, importing roughly
That said, with storage costs surging, inventories rotting, and farms going bust, this is positive news for a sector that has been decimated in recent months.
In other agricultural commodities, March corn futures dipped $0.15, or 0.39%, to $3.83 per pound. March wheat futures tacked on $0.05, or 0.94%, to $5.35 per bushel. January orange juice futures added $0.085, or 0.61%, to $1.40 a pound.
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