Bargain Prices for U.S. Soybeans Outweigh Tariffs for Some Chinese Buyers
Some Chinese buyers are still buying U.S. soybeans, as bargain prices outweigh the effects of high tariffs amid an ongoing trade war between the two countries. Prices on a free-on-board basis for U.S. soybeans out of the Gulf have fallen 30 percent to a decade-low price of $316 per ton. And even considering a 25 percent tariff, at these prices, U.S. soybeans are cheaper than those from Brazil. This is evidenced by two cargoes of U.S. soybean currently headed to China despite the possibility that Beijing may impose stricter controls as trade tensions intensify.
Although shipping between the two countries has nearly stopped, the bulk carriers Ultra Panther and Elsa S. are due to arrive this week in southern China and the port of Qingdao respectively. The buyers of the beans are unknown, and there is the possibility that the shipments were booked prior to the tariffs being imposed.
Regardless, the shipments have garnered interest in China, where many worry that customs may work to delay any U.S. goods through increased inspections, as has happened with pork and fruit.
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