China’s feed producers have sealed their first soymeal bulk cargo booking from Argentina since imports were approved by Beijing in 2019, as per a Reuters report.
This could mean the start of a new direction in the country’s soymeal sourcing strategy.
The shipment of 30,000 metric tons, set to arrive in Guangdong province in September, highlights how Chinese buyers have been searching for new sources and trying to lessen dependence on the United States due to protracted trade disputes.
The shipment was bought collectively by a number of Chinese feed companies at a CNF price of $360 per ton for loading in July, Reuters reported citing sources.
Strategic diversification amid trade tensions between the US and China
The move comes as Chinese enterprises attempt to protect feedstock supply chains from any disruptions caused by the long-running US-China trade spat.
China is the world’s largest consumer of soybean meal, which is widely used in animal feed.
While the majority of its present supply is generated locally by crushing imported soybeans, particularly from Brazil and the United States, taxes on American soybeans have caused many purchasers to curtail their purchases in favour of Brazilian alternatives.
Argentina, a global leader in soymeal and soy oil exports, had long been barred from entering the Chinese soymeal market because Beijing protected its domestic crushing sector.
However, in 2019, amidst escalating geopolitical tensions with the United States, China granted permission to Argentine soymeal imports.
Despite the policy change, no bulk shipments have occurred until the new agreement.
Economic incentives add momentum to the shift
Besides the politics, price competitiveness also played a role in the decision.
According to traders, Argentine soymeal is trading at lower prices than domestically crushed alternatives, also giving an edge in finance to the strategic sense of diversifying supply.
China brought in roughly 30,000 tons of soymeal in 2024, mainly from Denmark, according to customs figures.
Chinese feedmakers have razor-thin margins, so a pricing advantage might have a substantial impact on purchasing decisions.
Should the Argentine shipment be found compliant with regulations on arrival, it may open up the path for bigger and more regular imports from South America.
Testing the waters for long-term supply realignment
While the initial 30,000-ton shipment is minor in comparison to China’s total soymeal consumption, the purchase’s symbolic and geopolitical implications could be enormous.
The successful execution of this initial delivery may encourage other feed producers to follow suit, particularly if trade tensions with the United States linger or worsen.
Furthermore, the agreement demonstrates a growing openness among Chinese enterprises to consider alternatives to their traditional soybean import model, which has relied mainly on the United States and Brazil.
A more diverse import portfolio may assist China’s agricultural supply networks in withstanding geopolitical threats and global market volatility.
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