September 17, 2014
China signs deal to buy 4.8 million tonnes of US soy
A Chinese trade delegation signed agreements with US exporters to purchase 4.8 million tonnes of soyvalued at US$2.3 billion following a weeklong industry tour, the US Soybean Export Council said on Tuesday.
The 21 purchase agreements were signed late Monday during a global trade conference sponsored by the council in Milwaukee, Wisconsin.
These routine buying missions occur yearly, reflecting China''s huge demand for oilseeds and grains globally, traders said.
China, the world''s largest soybean buyer, purchased 28 million tonnes of US. soybeans during the 2013/14 crop season, or 60% of all US sales. With or without the agreements, Chinais expected to buy some 30 million tonnes of US soy during the 2014/15 marketing year, which runs Sept. 1, 2014, to Aug. 31, 2015.
Purchase agreements, or letters of intent, are not binding sales contracts but are traditionally honoured by trading partners, traders say.
Some exporters declare the agreements to the US Department of Agriculture, and they are then reported as sales per the government''s daily reporting rules.
The signing of agreements a year ago led to USDA reporting its largest one-day export sale during the 2013/14 marketing season when the agency reported soy sales of 2.112 million tonnes on Sept. 18, 2013.
This week''s delegation tour coincided with USDA on Thursday reporting large one-day soy sales of 810,000 tonnes, including 240,000 tonnes of US soy to China. Another 210,000 tonnes of US soybeans went to unknown destinations and 360,000 tonnes of optional-origin soybeans to China.