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Chinese Buying Fades Ahead of Holiday

More signs of fading Chinese interest in U.S. soybeans emerged this week, as traders wonder what will happen when the world’s largest buyer emerges after taking next week off for the Lunar New Year celebration.

USDA reported net new soybean bookings at 13.2 million bushels this week, a marketing year low. China took more than 60% of the total, but volumes have slowed noticeably as a record South American harvest approaches. China did cancel one load of new crop beans, but is still aggressively loading out its previous record-strong purchases from the U.S. Shipments for the latest week topped 44 million bushels, with China accounting for more than half the total.

Wheat sales came in better than expected at 21.2 million, perhaps supporting USDA’s decision on Tuesday not to change its forecast for the marketing year. Most buyers continue to take modest amounts, with customers from Asia and the Americas taking most of the total.

Corn sales at 29.5 million bushels were in line with trade guesses, though down from last week. South Korea, Japan and Mexico led the list of buyers, each taking multiple loads. However, shipments remain well under the rate needed to reach USDA’s forecast for the marketing year, which the agency lowered on Tuesday. Unless the pace picks up, sales for the year could fall even more.

This week’s report was delayed due to the big snowstorms hitting Washington this week. Next week’s will also come on Friday due to the President’s Day holiday which closes markets Monday.

For the complete export report, click here.