China’s Soybean Imports May Hit All-Time Record in 2023

China’s 2023 soybean imports may hit a record, but next year’s purchase outlook appeared dim due to weak demand from struggling hog farms.

US soybean futures for January delivery rose by 0.22% to $0.13 per bushel following the news, while Soybean Meal futures for December increased by 0.30% to $427.60 per tonne.

Brazilian soybeans are seen dominating China’s fourth-quarter imports due to superior oil and meal quality, curbing demand for US shipments in the world’s largest soybean market.

The larger part of Brazilian soy imports by China could weigh on Chicago futures Sv1, which has been down by almost 15% this year, ending a four-year rally.

New US soybean harvests often dominate global exports from September as Brazil’s season ends. However, China’s US purchases this year are lower than usual. Four trading sources said China will import 26 million in the December quarter, with Brazil accounting for 45% of the volumes.

Beijing’s soybean imports rose 14.4% year-over-year (YoY) to 77.8 million tons in the January-September period.

Elsewhere, Ukraine on Wednesday reported that Russia has dropped explosives possibly into the lanes of civilian vessels in the Black Sea three times in the past 24 hours. Still, operations in Ukraine’s new Black Sea shipping corridor continued.

Amid the Russian assault, Ukraine faces challenges sustaining grain exports in recent weeks, but wheat is weakened by a surplus of Russia’s inexpensive wheat.

The country’s agriculture minister stated in October that Russia would need 140 million tons of grain for 2023, including 93 million tons of wheat. It is the second-largest harvest following record crop in the previous year.

Russia-Ukraine War May Impact Soybean Exports

Amid geopolitical tensions between Russia and Ukraine, soybean exports may be affected by concerns over the Black Sea transit.

Analysts said Russia’s hesitation to support the route raises doubts about its long-term stability, citing it as the reason volatility has stayed.

Reports stated that Ukraine is rushing to increase energy infrastructure ahead of winter as renewed Russian airstrikes target the country’s power stations, potentially leaving its people with no source of light or heat.

Kyiv believed it was better to be ready for any attacks this time, according to the reports.

During the summer, Russia mainly focused its attacks on Ukraine’s seaports and facilities for grain exports.

However, missile and drone strikes in recent weeks have been aimed at Ukraine’s energy infrastructure again, a similar move from 2022 when the people of Kyiv were left in the dark for days.