China Seeks Trade Edge by Shunning US Soy in First Since 1990s

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(Bloomberg) — For the first time since at least the 1990s, China hasn’t bought any US soybeans at the start of the export season, a sign that Beijing is once again using agriculture as leverage in its trade fight with Washington.

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As the world’s top soybean buyer, China wields enormous influence over global markets. Now it’s reviving a familiar tactic of holding back on US purchases — deployed during the first trade war under President Donald Trump — as the two countries navigate a fragile truce.

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Data from the US Department of Agriculture show China hadn’t booked a single cargo as of Sept. 11, almost two weeks into the new marketing season — the first time in records going back to 1999. Last year, the US made up a fifth of China’s soybean imports, worth more than $12 billion, and accounting for over half of total US soy export value.

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Beijing, with healthy stockpiles in hand, is signaling it has the patience and capacity to wait — and that it’s willing to use commodities as a bargaining chip in broader trade talks. President Xi Jinping is set to speak with Trump on Friday, as the two countries spar over restrictions on semiconductors and rare earths. In the run-up, China has ratcheted up pressure by announcing that a preliminary probe found Nvidia Corp. in violation of anti-monopoly laws.

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“China’s approach on soybeans is similar to its approach on rare earths, in that it reflects years of careful game-planning since the last trade war,” said Even Pay, an agriculture analyst at Trivium China, a policy consultancy in Beijing. 

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“Buyers are responding not just to the high tariffs that remain on US beans, but also to the extremely high degree of uncertainty regarding the short term outlook for those tariffs, and the very clear political signals that Beijing does not want purchasing to happen without officials giving the go-ahead,” she said. 

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That strategy appears to be paying off. US farmers, flush with bumper harvests, are coping with prices near the lowest levels in years. The soy growers, who constitute a key voting bloc for Trump, have warned of a “trade and financial precipice,” urging the administration to cut a deal with China that removes tariffs. US soybeans going into China currently face duties of more than 20%.

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Across the Pacific, the mood is calmer. Chinese crushers, pig farmers and feed producers, bruised by the first trade war, have secured months of supply from Brazil. Some have doubled their inventories, while the state’s vast reserves provide an additional buffer. Soybeans are primarily crushed in China to produce soymeal for its massive pig feed industry and soyoil for cooking.

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Chinese importers have bought enough cargoes to cover their needs for the rest of this year, according to people familiar with the matter, who asked not to be identified discussing commercial matters. That pushes any urgency to scoop up US supplies to at least the first quarter of 2026, they said.

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Chinese buyers typically rely on US soybeans between October and February, before the South American harvest arrives. Importers tend to book weeks ahead to lock in cheaper prices, and by now would have already purchased a few million tons. But with trade tensions lingering, they’re steering clear of American beans, wary of retaliatory tariffs and geopolitical risks.