China has bought a second round of U.S. soybeans this month, the first purchases of U.S. soybeans by China since the beginning of a tit-for-tat trade war. The Department of Agriculture announced exporters sold 1.1 million metric tons to China for delivery by August 31st. The sales follow a trade war cease-fire to allow the U.S. and China to discuss a trade agreement of some sort by March of 2019.
Adding in last week’s China purchase, the total is at 2.629 million metric tons. Hoosier Ag Today market analyst Tom Fritz from EFG Group in Chicago says those numbers are disappointing.
“My theory is that China is buying soybeans piecemeal as to not run up the market on themselves. If that’s the case, if we sag lower in the next few days, you’ll see another purchase… the bottom line is their total so far is not market making. We continue to run into these ‘buy the rumor, sell the fact’ type situations.”
Hear Fritz’s full market analysis by listening to the HAT Morning Edition Podcast by clicking the ‘play’ button below.