Brazil soybean prices are increasing after China halted purchases of U.S. agricultural products. However, the jump has Chinese buyers shying away from purchases, according to Reuters. Brazilian soybean prices climbed to $400 a ton, including cost and freight, up $20 from a week ago.
The increase is the result of China stopping purchases of U.S. agricultural products as part of the tit-for-tat trade war sparked by the United States. China is the world’s biggest importer of soybeans, primarily used to feed the world’s largest hog herd. However, that too is complicating the market as traders are unsure of the long-term impact African swine fever will have on demand.
Before China announced its stoppage of U.S. purchases, soybean sales from the U.S. to China were approaching year-ago levels. Last year, China imported $9 billion worth of U.S. agricultural products, less than half of the near $20 billion imported in 2017. The U.S. Department of Agriculture, before China’s announcement, predicted China would import 85 million metric tons of soybeans in 2019, down from 94.1 last year.