China president Xi reportedly held telephone talks with Brazil president Lula

As Trump requires China to quadruple its soybean purchases from the US, Brazil is one to be involved as they’ve been China’s high soybeans provider for some time now. For some context, China is the world’s largest purchaser of soybeans however are dealing with a little bit of a tricky scenario this 12 months amid a provide glut out there.

Beijing made a file quantity of imports in early 2025 however are actually having to cope with very weak demand circumstances in addition to peak provide interval from Brazil lasting longer than earlier years. Meaning China goes to be coping with an abundance of provide heading into This fall – which is the height advertising season for the US.

In truth, China even exported roughly 127,000 tons of soybean oil in 1H 2025. That exceeds the complete quantity of no matter they exported via the entire of 2024.

So, what about this telephone name between Xi and Lula? There is not any particulars revealed however one can presume that assurances on soybeans commerce would have been a part of it. That particularly as Trump desires China to step up soybean purchases as a part of a gesture of goodwill to enhance commerce negotiations.

Nonetheless, how a lot of a risk is the US to Brazil’s exports to China? Effectively, not a lot ever because the entire Part One commerce deal debacle. From yesterday: Of soybeans and commerce offers

Trying on the newest delivery information for June, China imported 9.73 million tons of soybeans from Brazil – a file for the June month. In the meantime, they solely imported a measly 724,000 tons from the US. And amid the availability glut confronted for the time being, Beijing has but to even make any reserving of US soybean cargoes for This fall with patrons citing “uncertainty on commerce negotiations”.

So, yeah. The US desires China to step up soybean purchases as we glance in the direction of the approaching quarter(s). But it surely actually could not be coming at a foul time for Beijing amid the market scenario. And in any case, Brazil’s market share won’t doubtless be threatened all an excessive amount of. Even when it does, one can look again to 2019-2020 when China solely stepped up US imports to maintain up appearances for some time. All that earlier than reverting again to the place we’re right this moment.

This text was written by Justin Low at investinglive.com.