Chicago | Reuters — U.S. soybean futures jumped to their highest level in more than four months on Monday on hopes that China will resume buying American supplies after President Donald Trump said the countries were set to reach a trade deal during his trip to Asia this week.
China, the world’s biggest soy importer, has shunned soybeans from the autumn U.S. harvest and shifted purchases to South American suppliers due to the trade conflict with Washington.
The dispute has robbed U.S. soy farmers of their largest market, hurting crop prices at a time when they are facing high costs for inputs such as fertilizer.
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Trump said the U.S. and China were set to “come away with” a trade deal. He was expected to meet Chinese President Xi Jinping on Thursday in South Korea after officials from both countries talked this weekend in Kuala Lumpur.
“I think most people feel now that they’re going to get something done with China,” said Jim Gerlach, president of commodities brokerage A/C Trading in Indiana.
At the Chicago Board of Trade, most-active soybean futures Sv1 ended 25-1/2 cents higher at $10.67-1/4 per bushel and hit their highest price since June 20.
Buying spilled over into the corn and wheat markets, traders said. Corn Cv1 ended up 5-1/2 cents at $4.28-3/4 per bushel and reached its highest since July 3. CBOT wheat Wv1 closed up 13-1/2 cents at $5.26 per bushel and reached its highest level since September 18.
The markets need details on any U.S.-China deal, said Matt Ammermann, commodity risk manager at StoneX.
“Currently, fear and hype are the main trading factors,” he said.
U.S. Treasury Secretary Scott Bessent on Sunday said U.S. and Chinese officials agreed to a framework trade deal and he anticipated China would revive substantial purchases of U.S. soybeans.
This month, trade sources said China still needed to purchase soybeans for December-January shipment after covering cargoes through November with hefty purchases of South American soy. Brazil, the world’s biggest supplier, will harvest its next crop around February.
“Talk is China continues to book Brazilian soybean cargoes for December-March shipment,” Ammermann said. “But it appears China still has 5-8 million tons of required soybean purchases to bridge the gap to Brazil’s new crop, so China still has a supply requirement which could be transferred to the U.S.”
— Reporting by Tom Polansek in Chicago, Michael Hogan in Hamburg and Ella Cao and Lewis Jackson in Beijing.
