- Bearish US soybeans: Chinese private crushers favor Brazilian supplies due to a 10-percentage-point tariff advantage (13% vs 3%), limiting commercial demand for US origins.
- Supportive for Brazilian exports: Record projected Brazilian production of 182.2 million tonnes underpins aggressive forward sales and competitive pricing into China.
- Neutral to bearish for Black Sea protein complex: Cheaper Brazilian soybeans dominate Asia-Pacific feed demand, though relative price pressure may indirectly support Black Sea sunseed products.
- Policy-driven trade flows: Chinese state entities (Sinograin, COFCO) absorb US volumes to meet obligations, while private crushers optimize margins by focusing on Brazil.
China Prioritizes Brazilian Soybeans Over US Supplies
Chinese private soybean crushers continue to prioritize Brazilian origins despite the resumption of US exports. Contracts of 42–44 million tonnes of Brazilian soybeans have been secured for September–August delivery, including 23–25 million tonnes scheduled for February–August 2026. This trend reflects Brazil’s record production outlook and strong price competitiveness in the Chinese market.
By contrast, US soybeans are currently being purchased almost exclusively by state-owned enterprises Sinograin and COFCO, which have bought around 12 million tonnes since late October. For private processors, the 13% tariff on US soybeans versus just 3% on Brazilian product makes American supplies uneconomic, even as China maintains bilateral trade commitments with the United States.
Brazilian Production and Export Outlook
Agroconsult forecasts Brazil’s 2025/26 soybean crop at a record 182.2 million tonnes, reinforcing the country’s capacity to offer attractively priced exports. Rabobank analysts project Brazilian soybean exports to China at approximately 85 million tonnes between September 2025 and August 2026, about 6 million tonnes higher year-on-year, further entrenching Brazil as China’s dominant soybean supplier.
| Item | Period | Volume (million tonnes) |
|---|---|---|
| Brazilian soybeans contracted by China | Sep–Aug (overall) | 42–44 |
| Brazilian soybeans contracted by China | Feb–Aug 2026 | 23–25 (subset of total) |
| Brazilian soybean production forecast | 2025/26 | 182.2 |
| Brazilian soybean exports to China (forecast) | Sep 2025–Aug 2026 | 85 |
| Increase in Brazilian exports to China | Year-on-year | +6 |
| US soybeans bought by Chinese SOEs | Since late October | ~12 |
Implications for Global Oilseed and Protein Markets
The tariff differential between US and Brazilian soybeans is driving a clear bifurcation in Chinese buying patterns: state entities absorb US volumes to satisfy political and contractual obligations, while private crushers focus on maximizing margins through Brazilian purchases. This policy-driven allocation is reshaping trade flows independently of traditional supply-and-demand fundamentals.
For the Black Sea region, which is a minor soybean exporter but a significant supplier of sunflower meal and other protein feeds, sustained Brazilian price competitiveness in China is broadly neutral to bearish. However, persistent pressure on global soybean prices could indirectly support demand for alternative protein sources from the Black Sea, as buyers seek the most cost-effective options in feed ration formulations.
Source: Market Data
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