A trade game around soybeans is quietly heating up.
Brazil’s soybean supply to China continues to surge, far exceeding the premium range of U.S. soybean.
Chinese buyers have collectively suspended purchases of Brazilian soybeans.
The direction of this game depends on the approaching pace of the two major opportunities.
To steal from fire or not?
Nearly a hundred large and medium-sized oil companies in Brazil have collectively suspended purchases of Brazilian soybeans in December and January next year, involving purchases estimated at 8 million tons, equivalent to 70% of Brazilian monthly exports to China.
And all this led to the rising price of Brazilian soybeans and the rising offer to China.
China imports about 100 million tons of soybean every year, 60 percent of which comes from Brazil.
This collective shutdown, on the one hand, is the Brazilian food merchants with stock unwilling to loose, on the other hand, is the Chinese enterprises carrying losses to bite the tooth, the world's largest soybean importer and the largest exporter game, instantly into white heat.
Why is the price of Brazilian soybeans suddenly rising?
The October report of Brazil's National Commodity Supply Company showed that the northern state of Mato Grosso suffered a once-in-50-year heavy rain, which caused 15% of the soybean harvest to be delayed, and the goods originally arriving in October were delayed until November.
Another drought occurred in the southern state of Rio Grande, and the yield per unit area dropped by 2% compared with last year.
To make matters worse, in September, Brazilian truck drivers went on strike over fuel price increases. More than 2 million tons of soybeans were stranded in the Port of Sao Paulo, and the daily detention fee was as high as US$1.2 million.
The rise in logistics costs has become a driving force for price increases.
Brazil's "invisible driver" of price increases
According to data from the Brazilian Logistics Association, in 2025 the cost of transportation of soybeans from land of origin to port increased by 18%, coupled with fluctuations in exchange rates, and the actual cost of Brazilian groceries increased considerably.
But the rising cost is only an excuse, and the real bottom line is China’s high tariffs on U.S. soybeans.
After Trump took office for the second time in 2025, he imposed a 10%-60% tariff on Chinese goods exported to the United States. China countered and raised the tariff on U.S. soybeans to more than 90%, which completely lost its price advantage.
Brazilian grocery traders saw the time and began to raise the offer for stockpiling.
This route was used once in Brazil in 2018.
At the time, China imported more than 80 million tons of soybeans from Brazil, accounting for 53 percent of total imports that year.
Just when Chinese companies thought they could find a stable source of supply, Brazil suddenly unilaterally raised export prices, rising $40 per ton.
At the time, the FAO procurement team flew to Brazil to negotiate, the other side was tough, saying "either accept price increases, or wait for goods."
Chinese companies decided to abandon the cooperation, resulting in a Brazilian cargo vessel carrying 3 million tons of soybeans staying in Qingdao port for two months, stagnation fees and storage fees combined are more expensive than soybeans themselves, eventually Brazil had to reduce the price by 15 percent to reach a deal.
With the lesson learned last time, China's suspension of purchases this time seems full of confidence.
The most important thing is that China buyers hold two "trump cards" in their hands.
Stop the purchase, wait two hours.
The first is Brazilian beans.
The latest forecast of the Brazilian National Commodity Supply Company is that the output of new beans harvested early next year will reach 177.64 million tons, 6 million tons more than this year, and the planting area will also expand to 48.2 million hectares.
The second opportunity is Sino-US trade negotiations.
In mid-October, China and the United States held a new round of economic and trade negotiations in Washington, and the issue of soybean tariffs was included in the core topic.
The United States proposed to reduce Chinese soybean tariffs to 30%, while China asked the United States to cancel agricultural export subsidies to China. The two sides have reached a preliminary consensus on soybean inspection and quarantine standards.
Once a breakthrough is reached in the negotiations, the price advantage of U.S. soybeans will re-emerge.
The basic price of U.S. soybeans would be lower than Brazil, and in 2024 China imported more than 20 million tons of soybeans from the United States, as long as tariffs drop, U.S. soybeans can completely fill the Brazilian gap.
Even if neither of these times came as expected, China has a backhand.
“Double Insurance” Policy and Markets
The State Grain and Material Reserve Administration announced on October 20 that 1.5 million tons of reserve soybeans had been released, and the market price dropped by 4.3% that day.
Diversified import channels also give China more choices.
While Brazil has raised prices, Argentina has been quietly subsidizing.
In September 2025, Argentina suspended the export tax on soybeans, and Chinese companies had the opportunity to purchase 5 million tons, equivalent to 35 percent of total imports that month.
According to data from the Argentine Ministry of Agriculture, its soybean export orders reached a seven-year high in September, with 80 percent coming from China.
In addition to Argentina, Uruguay and Canada have also become candidates. Canada's soybean exports to China have increased by 20% this year, accounting for 8% of China's total imports.
More importantly, breakthroughs in soybeans replacement technologies are reducing dependence on soybeans.
China's "Alternative Revolution" Deep Breakthrough
Composite proteinase technology developed by the Chinese Academy of Agriculture can raise the rate of removal of anti-nutrition factors in cotton seeds from 60% to 92%, and now many feed factories are replacing soy seeds with cotton seeds.
By 2025, the proportion of domestic groceries replacing soybeans has risen to 22%, saving 18 million tons of soybeans per year, equivalent to Argentina’s year-round exports to China.
Many people will ask, why doesn't China grow more soybeans?
It's not that I don't want to plant it, I really don't have land.
China needs 100 million tons of soybeans every year, and more than 600 million mu of cultivated land is needed to plant so many soybeans, while the total area of cultivated land in China is only 1.8 billion mu, of which 1.05 billion mu needs to be planted with rice, wheat and corn, so as to ensure the food safety of 1.4 billion people.
Heilongjiang is the main soybean producing area in China. This year, the planting area is 155 million mu, and the maximum yield per mu is 420 kg. However, even if soybeans are planted on all the land that can be planted, the total output is only 20 million tons, and the self-sufficiency rate is only 20%.
And the U.S. soybeans are scaled cultivation, a harvesting machine can harvest 1000 acres a day, China's cultivated land is dispersed, mechanization efficiency is 30% lower than in the United States, and the planting cost is much higher.
Brazil actually knows that price increases are a double-edged sword.
Soybeans account for 38.8% of Brazil's total agricultural output value, and 70% of soybean exports rely on China.
Brazil's soybean exports to China reached $28 billion between 2025 and September, accounting for 42 percent of its total agricultural exports.
If China stops long-term purchases, Brazil’s soybean stocks will explode by 30 percent, and many food traders could face losses.
Recently, Bonge, Brazil's largest grain merchant, has begun to relax and quietly quoted China companies at a price of US$440/ton, down US$18 from before.
The pattern of the global soybean market is also changing.
The International Grain Council predicts that the total global soybean production will reach 398 million tons in 2025, a year-on-year increase of 2.1%.
In addition to Brazil, Argentina's soybean production increased by 8.3%, and the soybean planting area in the Russian Far East is also expanding. In 2025, it will export 3 million tons to China, and the target for the next five years is 10 million tons.
Under the RCEP framework, soybean trade tariffs between China and Thailand and Vietnam have been reduced to zero, and soybean imports from these two countries have increased by 45% year-on-year this year.
Behind this soybean game lies a way to break China's food security.
From reliance on the United States to multi-import, from passive acceptance of price increases to active technological breakthroughs, China is building a more resilient supply chain.
In the future, with the improvement of domestic soybean varieties and the improvement of the global procurement network, one day, we will no longer have to worry about soybean prices.
But now, the game of stopping and raising prices continues, and the cards in the hands of China are clearly increasing.
Edited by: Alone