China appears poised to absorb a larger share of Brazilian soybean exports in the first half of 2026, driven by record South American output and price competitiveness that are prompting Chinese private processors to lock in shipments due from February as the Brazilian harvest accelerates.
Trade participants say the flow of Brazilian supplies, and the subsequent downward pressure on prices, is likely to dampen demand for U.S. soybeans when North American exports resume in September. Private buyers in China are securing deals for Brazilian cargoes to arrive from February onwards, taking advantage of a harvest that is swelling availability and squeezing margins for foreign-origin beans.
Since late October, Chinese state-owned firms Sinograin and COFCO have bought roughly 12 million metric tons of U.S. soybeans following an improvement in bilateral ties. Those purchases, however, were executed by state entities, with private traders remaining sidelined by higher U.S. prices relative to Brazilian alternatives.
China maintains a 13% tariff on U.S. soybeans, which makes them more expensive for private crushers compared with Brazilian supplies that face a 3% duty. That tariff gap has been a material factor in steering private sector demand toward South American beans.
Political considerations are also visible in the pattern of purchases. Dan Wang, China director at Eurasia Group, said the current volumes of U.S. soybeans bought by China are limited and "sufficient only to maintain a positive political atmosphere ahead of the April meeting between the two countries' leaders." Wang added that any larger commitments would likely depend on concrete outcomes from that meeting, including tariff moves or political assurances.
Market participants and analysts report that crush margins for Brazilian soybeans shipped between March and June remain favourable, underpinning recent deal flow. A trader at a large global firm told Reuters, "We will probably see higher exports (from Brazil) to China in the period from March to June, higher than last year. Brazil's soybeans are way cheaper than U.S. soy in this period." Several sources spoke on condition of anonymity because the subject is sensitive.
Earlier in the market cycle, expectations had leaned toward a reduction in Chinese buys of Brazilian soybeans as U.S. cargoes re-entered the picture. Those expectations have been upended by the relative prices and the scale of the South American harvest.
Price comparisons from mid-November illustrate the gap. On November 18, Brazilian soybeans for December shipment to China were priced at $507.90 per metric ton on a cost-and-freight basis, excluding tariffs. At the same time, U.S. Gulf supplies were priced at $516.90 per metric ton, and U.S. Pacific Northwest origin at $510.50 per metric ton on the same basis. On those levels, China would have paid roughly $31 million to $108 million more for 12 million tons of U.S. soybeans than for Brazilian cargoes.
China resumed U.S. soybean purchases after a late-October meeting between the two countries' leaders. The White House stated that China had agreed to buy at least 25 million tons a year over the next three years, beginning in 2026. Separately, U.S. President Donald Trump said he would visit China in April while Chinese President Xi Jinping is expected to travel to the United States toward the end of 2026.
Traders say further U.S. bookings are unlikely in the near term because of the price disadvantage and expectations of bumper crops in Brazil and Argentina. Adelson Gasparin, a grain broker in southern Brazil, observed, "Our large crop makes our product cheaper than the U.S. one, and this tends to last until the arrival of the new U.S. soy from September." He expects China to sustain import levels under that dynamic.
Price differentials are significant on a per-bushel basis for early-season shipments. Traders and analysts report Brazilian soybeans shipped in February are at least 50 cents a bushel cheaper than U.S. Gulf shipments on a free-on-board basis and up to 75 cents cheaper for March shipments. As the harvest accelerates and more supply enters the market, Brazilian prices are likely to face further pressure. Dan Basse, president of AgResource Co., predicted the gap could widen, saying, "I think the difference is going to widen out. Maybe to something like a dollar."
While some U.S. shipments could still find buyers during the peak South American export season, traders expect any such purchases to be small unless Beijing issues an explicit directive to buy U.S. supplies. One trader noted, "I don't think it works without a government enforcement." Another constraint would be the logistical situation in Brazil; a surge of South American corn shipments that floods ports could affect soy flows and pricing dynamics.
Supply projections and booking data underline the scale of the South American influence. Brazil's 2025/26 soybean production is forecast at a record 182.2 million tons according to agribusiness consultancy Agroconsult. Rabobank senior grain and oilseeds analyst Marcela Marini expects Brazil to export about 85 million tons to China for the September 2025 to August 2026 period, which would be an increase of 6 million tons over the prior year.
Chinese booking data from traders indicate that roughly 42 million to 44 million tons of Brazilian soybeans have been scheduled for shipment to China for the September to August marketing year, including about 23 million to 25 million tons for February to August. Those volumes underscore the central role South American supplies are expected to play in meeting Chinese import needs over the coming months.
Domestic demand patterns in China also support robust soymeal consumption. The nation's pig herd remains large despite government efforts to reduce overcapacity, and analysts say a substantial reduction is unlikely before the end of the second quarter. That persistent herd size should keep soymeal demand strong through the first half of 2026.
For the 2024/25 marketing year, China imported 109.37 million metric tons of soybeans. The farm ministry projects imports for 2025/26 to fall to 95.8 million metric tons, a decline that reflects both shifting origin mixes and changing domestic demand patterns.
In sum, record South American production and a meaningful tariff and price advantage for Brazilian soybeans are shaping China’s buying strategy for early 2026. State-led purchases of U.S. soy have resumed to satisfy diplomatic and trade commitments, but private crushers appear set to favour cheaper Brazilian cargoes arriving from February through mid-year unless government directives or tariff changes alter the economics.