A Chinese trade delegation signed deals Feb. 17 to buy a record amount of U.S. soybeans during a visit to the United States at a time when a harsh drought has slashed crops in rival soy exporters in South America.
The delegation inked agreements for 13.4 million tonnes valued at $6.7 billion, the U.S. Soybean Export Council said, a quarter of the more than 55 million tonnes the world’s largest soybean buyer will import from global suppliers this year.
The agreements — signed during a visit by Chinese Vice-President Xi Jinping — paired Chinese powerhouses such as state-owned trading house COFCO Co. Ltd. and grain reserve manager Sinograin with the likes of Archer Daniels Midland, Bunge, and Cargill, among others.
The deals, which are not technically sales but often lead to confirmed sales, come as U.S. farmers begin preparing to plant their 2012 crop amid thin stockpiles and as South American crop prospects shrink following a drought.
The U.S. Department of Agriculture on Feb. 17 confirmed the sale of 2.92 million tonnes of U.S. soybeans to China, a single-day sales record.
To date, China has purchased nearly three million tonnes of U.S. soybeans for shipment in 2012-13, compared with more than 5.1 million tonnes at the same point last year, according to USDA data.