Chinese buyers are still avoiding U.S. soybeans and other commodities, a move many analysts see as Beijing's effort to maximize leverage in ongoing trade discussions. Absent a political settlement, many fear that renewed Chinese purchases could still be several months away.
At the end of August, China had booked no future sales for U.S. soybeans, corn, wheat and sorghum, according to a recent analysis from North Dakota State University. Beef, pork and cotton orders are also lagging recent years.
The Agriculture Department is forecasting export losses for the 2025-26 marketing year that are deeper than losses during President Donald Trump's first administration.
The U.S. soybean industry, which relies on the Chinese market for around half of its total exports, is particularly concerned. Analysts tell Agri-Pulse that they’re right to be.
Beijing’s 20% retaliatory tariff on U.S. soybeans has left U.S. product less competitive than other suppliers’, like Brazil. And unlike in 2018 when Trump’s tariff escalation caught Beijing off guard, Chinese traders had ample time to prepare for a renewed trade conflict and stockpiled soybeans to sustain a protracted buying freeze.
“They have been strategically smart in setting up their pieces,” said Matthew Nicol, an agricultural trade policy analyst at China Policy. “They've really front-loaded imports this year.”
Between May and August, China imported around 50 million tons of soybeans and was sitting on commercial stocks of around 6.8 million tons at the end of August, Nicol said.
“This allows them to delay U.S. purchases without risking crushers running dry,” he added. “They're trying to signal is that the winter is secure, even if U.S. [export] volumes stay at zero.”
Official Chinese data is not always reliable. However, in this instance many analysts say the data appears in line with recent export patterns. China’s soybean imports from Brazil in March were well above recent years’, as were July and August purchases.
U.S. soybean exports to China typically begin ramping up in September and October. But with no orders on the books and significant Chinese stockpiles analysts say the first orders may not land until early 2026, if at all.
Shawn Arita, associate research professor at North Dakota State University (NDSU), said that with recent stockpiling, China may have enough soybeans to hold them over until Brazil’s next harvest in March.
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“It won't be pain-free,” he said. Buyers would have to sacrifice some quality. But he added that if the political will exists “they could live off of a complete boycott.”
What will revive Chinese purchases?
It’s not just soybean farmers that are worried. Chinese buyers have historically accounted for around 90% of U.S. sorghum exports, according to Tim Lust, CEO at the National Sorghum Producers. With no future orders on the books, anxiety is also running high.
“We're at a critical time,” Lust said. Lust argued the ideal solution would be a political settlement, along the lines of the phase one deal signed in 2020, which included commitments to purchase U.S. commodities.
But negotiations on a trade pact to smooth trade relations have been slow.
U.S. and Chinese officials met this week in Madrid to discuss trade and economic issues – their fourth such meeting since Trump’s second term began. However, agricultural trade did not feature in officials’ public comments and both sides agreed to leave conversations on many of the most pressing trade issues for future meetings.
Nicol doubts that the current political and economic landscape is conducive to another deal laden with ag purchase commitments.
China, he says, has reduced its reliance on U.S. agricultural commodities since 2020. Increasing domestic production of key commodities has also emboldened Beijing to wield ag imports as leverage in other trade disputes, including those with China and the European Union.
The phase one deal, Nicol said, was signed when Chinese stocks of many ag commodities were low. There were also questions about the quality of those reserves. Today, strategic reserves are high.
“They are pretty much as well set as you could be,” Nicol said.
Further, in the buildup to the talks in Madrid this week, neither side looked like it was making efforts to cool trade tensions. Beijing intensified its regulatory campaign against U.S. chipmaker Nvidia, for example, and the U.S. added more Chinese companies to its semiconductor trade blacklist.
If a political agreement fails to materialize, economic forces may bring Chinese buyers back to U.S. vendors. Texas Tech University economist Darren Hudson said falling prices for U.S. cotton will eventually force Chinese buyers to turn to the U.S.
“It's probably just going to come and fits and starts as the price gets competitive for them,” he said.
A similar phenomenon could eventually occur for soybeans, according to former USDA economist Fred Gale. Prices for Brazilian soybeans have been rising on increased demand, as U.S. prices have been falling. In U.S. regions serving the Chinese market, including the northern Plains, prices have dropped below $8.50 per bushel – well below production costs, according to NDSU research.
Price changes can take months to show up in soybean crushers' import costs, but Gale said crushing margins for Chinese soybean processors could turn negative before the end of the year. Under such a scenario, buyers may return to the U.S. crop.
Matthew Nicol (LinkedIn photo)The longer the buying freeze on U.S. soybeans lasts, the higher Brazilian prices could rise, Nicol said, further tilting the economic incentives in favor of the U.S. In the January to March window, Brazil’s old crop will be dwindling, Nicol argued, while the next Argentinian and Brazilian harvests won’t have hit yet.
“There is the risk for Beijing of overpaying,” he said – particularly if any weather disruptions impact the timing or quality of the next South American crop.
Delays spur infrastructure woes
But several months of minimal – or zero – Chinese purchases of critical commodities is also stoking fears that inaction will corrode U.S. supply chains, reduce reliability and raise transportation costs before Chinese buyers return.
Freight and transportation prices depend on sustained demand for routes. Several months of weak demand for shuttles from soybean growing regions to Pacific ports are set to raise costs for exporters.
Deteriorating trade relations with China are already having an impact on the freight market, according to new analysis published this week from North Dakota State.
BNSF Railway reduced soybean shuttle costs on routes to the Gulf and Mexico in September as trade conditions became more favorable to regions served by the Gulf Coast ports. Its Pacific soybean shuttle tariffs remain unchanged, however.
Similarly, Union Pacific Railroad has cut prices for trains serving the Gulf and Mexico more steeply than those serving the Pacific Northwest region.
Elevators that specialize in handling specific crops like sorghum may struggle to turn a profit and stay afloat during months of reduced sales, Lust said.
“We have had significant purchases from our domestic ethanol industry,” Lust said, but he anticipates they will not be enough to offset export losses.
Storage could also become an issue if commodity producers and exporters have to sit on large quantities of unsold product, said Sandro Steinbach, an associate professor at NDSU. The upper Midwest region, Steinbach said, is already gearing up for soybean and corn storage shortages.
Temporary solutions are available, but they could further squeeze producers already battling low prices, high transportation costs and the myriad of other issues plaguing farm country.
Bean bags, a short-term storage option, are primarily produced in China, which means they are subject to new U.S. tariffs. Longer-term storage solutions may also require steel, aluminum or derivative products, which have been hit with steep new duties in Trump’s second term.
“At the farmer level and at the industry level the pressure continues to mount,” said Lust, the National Sorghum Producers CEO. “It's high stakes.”
