The Battle for Soybean Pricing Power: Brazil Dares to Raise Prices—Why Does China Have the Confidence to Say 'No'?

Soybean international trade has been a critical component of the U.S.-China trade conflict. After Donald Trump’s administration returned to the White House in April 2025, it raised tariffs on Chinese goods to 145%. In retaliation, China immediately raised tariffs on U.S. imports to 125%. As a result, the effective comprehensive tariff burden on U.S. soybeans entering the Chinese market soared to 34%, completely eroding their price competitiveness. Starting in May 2025, China halted all purchases of U.S. soybeans—a first-in-30-years occurrence of zero procurement from the United States. To actively counter Washington’s unilateral trade policies, China swiftly pivoted to South American markets after suspending U.S. soybean imports. From January to August 2025, China’s total soybean imports amounted to 73.3124 million tons, with Brazil as the primary supplier—accounting for a staggering 71.6%. In September alone, China’s soybean imports from Brazil surged 29.9% year-on-year to 10.96 million tons. As China ramped up purchases from Brazil, Brazilian grain traders sensed room for price hikes. In April 2025, the cost, insurance, and freight (CIF) price of Brazilian soybeans to China jumped from RMB 3,800 per ton to RMB 4,180 per ton—a rise exceeding 10% within just one month. Quotations for some premium varieties even breached RMB 4,200 per ton, hitting a three-year high for this period. In October 2025, prices for Brazilian soybeans exported to China rose markedly. Strengthening of the Brazilian real and rising ocean freight costs added roughly RMB 200 per ton to procurement expenses, prompting Brazilian exporters to push for higher prices. At the start of October, the spot premium for Brazilian soybeans reached USD 2.8–2.9 per bushel—above Chicago futures and about USD 1 per bushel more expensive than comparable U.S. products. On October 22, the Brazilian Association of Vegetable Oil Exporters (ABIOVE) set a new quotation of USD 650 per ton for soybeans destined for China in São Paulo—an increase of 12% over September’s level. Yet Chinese buyers responded swiftly, redirecting orders to Argentina. Meanwhile, COFCO and other major enterprises suspended new purchase contracts for Brazilian soybeans. What economic principles govern soybean pricing in international trade? Soybeans are physical commodities—and thus follow the economic laws applicable to physical goods. For physical commodities, use value and price exhibit a linear relationship.

"Brazilian Soybean Premium Hits 80%; China Halts 8-Million-Ton Orders! A Strategic Game Is Underway"

Faced with unreasonable price hikes, China has adopted a notably calm and composed stance. The China National Grain and Oils Information Center (Sinograin) holds a strategic soybean reserve of 45 million tons—sufficient to meet national demand for over three months. In October, it auctioned off more than 40,000 tons of domestically stored older soybeans; in November, it plans to release additional imported reserve soybeans. China’s import diversification strategy provides crucial flexibility against price volatility. After Argentina slashed its soybean export tax to zero in September 2025, Chinese buyers snapped up 1.3 million tons of Argentine soybeans within 48 hours—equivalent to over 30% of China’s total imports from Argentina in 2024. Russia’s Far East region supplies over 200,000 tons of soybeans to China each month, while Ukrainian supplies reach China via the China-Europe Railway Express in just 20 days. This ‘mainstay + supplementary + contingency’ supply mix breaks past dependence on any single country. Technological substitution is also advancing steadily. Rapeseed meal, cottonseed meal, and other alternative protein meals can replace up to 15% of soybean meal usage. China’s Ministry of Agriculture and Rural Affairs has set a clear target: to reduce the share of soybean meal in animal feed—from 15.3% down to 12%—by 2027. A Hunan-based enterprise has already cut soybean meal inclusion to below 8%. Meanwhile, low-protein feeding technologies adopted by dairy farms can slash soybean meal usage by 30% without compromising milk yield. Cumulatively, these measures deliver substantial impact. 04 Key Turning Points in the Game: New-Crop Harvest and U.S.-China Negotiations Buyers are now awaiting two pivotal developments. First is the timing of Brazil’s new-crop soybean harvest. For the 2025/26 season, Brazil’s planting progress has already reached 14%—the second-fastest pace on record for this time of year. Private consultancy Safras & Mercado forecasts production at 180.92 million tons—up 5.3% year-on-year. The U.S. Department of Agriculture (USDA) offers a more conservative estimate of 175 million tons. If weather conditions remain favorable, increased supply from concentrated harvesting in January and February next year could drive prices downward. The second turning point hinges on U.S.-China trade negotiations. Should substantive progress be achieved on trade issues by late October, restrictions on U.S. soybean imports may be eased. Over 20 million tons of soybeans currently sit unsold in U.S. warehouses, with prices having slumped to a decade-low; American farmers are urgently seeking new markets. Once China reopens its market, U.S. soybeans could exert countervailing pressure on Brazilian prices. This comparative-price effect would significantly strengthen Chinese buyers’ bargaining power. Brazil’s own policy adjustments may also influence the market. The Brazilian government plans to invest USD 2.3 billion in port infrastructure upgrades, expected to ease logistical bottlenecks by 2026. Should the real appreciate back into the BRL 5.3–5.4 range, upward pricing pressure would likewise ease. 05 Reshaping the Global Soybean Trade Landscape This trade contest reflects profound shifts in the global soybean trade architecture. The Trump administration’s trade war severed U.S. soybean exports to China—enabling Brazil to consolidate its status as the world’s preeminent soybean superpower. Brazil capitalized on the trade tensions triggered by Trump—not for the first time. During Trump’s first term, when he imposed tariffs on Chinese goods, a similar dynamic unfolded: Brazil’s share of China’s soybean imports surged from roughly 50% in 2017 to 75% in 2018. Yet Brazil’s windfall may face a challenge by late October—at the Asia-Pacific Economic Cooperation (APEC) summit in Korea, where high-level talks are scheduled.

China Shuns Costly Brazilian Soybeans Ahead of Trump-Xi Summit

Sep 24, 2026

Chinese soybean imports from Brazil have slowed sharply due to high prices squeezing margins, raising supply risks ahead of the Trump-Xi summit. Traders await potential US tariff cuts while state-owned firms ramp up American bean purchases.

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