Chinese Buyers Grumble Over Pricey Brazilian Soybeans

Most commentary leading up to today's Trump-Xi meeting seems to ascertain that China doesn't need U.S. soybeans. Beneath the surface, though, Chinese soybean buyers are showing signs of angst as they pile up financial losses and look longingly at U.S. soybeans that are substantially cheaper than the Brazilian beans that have comprised 80-to-90% of their supplies since May. Cracks are appearing in the seemingly cozy China-Brazil soybean relationship as Chinese buyers try to scarf up as many beans as possible from the shrinking Brazilian supply.

China purchased 180,000 metric tons of U.S. soybeans this week -- probably meant as a show of good will ahead of today's inconclusive Trump-Xi meeting. The only signal to markets from the meeting itself was President Trump's vague assurance that Xi has authorized "massive" Chinese purchases of American soybeans. 

Chinese crushing plants have been processing about 9-to-10 million metric tons of soybeans monthly since record-large Brazilian supplies began arriving in May. The crushers are pumping out huge volumes of soybean meal for the Chinese feed manufacturing industry which is also producing at record levels. Soybean oil is also flooding the market and keeping a lid on prices, contributing to China's emergence as a significant soy oil exporter for the first time this year. 

Trouble is, China's soybean processors are not making money. With Brazilian soybean prices edging up and prices weak for soybean meal and oil, the crushers have had negative margins for several months. Market reports from China indicate availability of cheaper U.S. soybeans would be welcomed by crushers who have been watching losses pile up.

An October 17 article posted on the Chinese soybean industry association web site reported that high Brazilian prices were deterring Chinese buyers from purchasing beans to cover needs for December and January. The article reported an 8-to-9 million-ton gap in supplies that Chinese buyers were hoping would be filled by a release of Chinese State reserves and/or by renewed access to cheaper U.S. soybeans in the event of a Trump-Xi agreement. 

An October 27 Futures Daily soymeal market analysis echoed a similar slowdown in purchases due to a negative RMB 230 yuan/ton crushing margin for Brazilian soybeans for December shipment. According to Futures Daily, as of mid-October China had bought 5.26 mmt of soybeans for November, covering 88% of needs. They had bought just 726,000 mt for December, covering 16% of needs; and none for January. The article predicted a significant shortage of soybeans for January to March 2026. 

An October 27 National Grain and Oils Information Center (NGOIC) analysis reported that the cost of December Brazilian soybean shipments increased $8 per metric ton last week, translating to a RMB 65 per metric ton increase in C&F cost for importers in southern China to RMB 3943 per ton. The crushing margin for December Brazilian soybeans was estimated at negative RMB 263 per ton.

A rise in Brazilian prices since mid-2025 led to an unusual premium of Brazilian over U.S. soybean prices as China stopped buying U.S. soybeans and turned to purchasing Brazilian soybeans almost exclusively. Historically, FOB prices for U.S. and Brazilian beans were typically near parity. But the price of Brazilian beans soared more than 17% from early March to a mid-September peak, resulting in a rare premium for Brazilian beans. The fob price of Brazilian beans rose above the U.S. fob price in late May, and the spread between them widened to 12% in mid-September.

The Brazilian currency appreciated about 7% against the U.S. dollar between March and September this year, a factor contributing to the rise in Brazilian prices. The price of soybeans in local Brazilian currency shows a spike in April when Chinese buyers first flocked to buy from Brazil. After a decline in early May, the Brazil price in local currency rose 9 percent to its peak in August. The price dropped 5% in a week during September 17-24--apparently when Chinese buyers browbeat Brazilian sellers into cutting prices, as discussed below. Since then, the Brazilian price has rebounded less than 2%.

Source: CEPEA, converted to Reais at official exchange rate.

Brazil also crushes its soybeans, so Chinese buyers have to offer higher prices to lure soybeans away from Brazilian users. One recent analysis observed that crush margins in Brazil also deteriorated with the rise in prices for Brazilian soybeans. An American Soybean Association analysis noted this competition and estimated that Brazilian ending stocks could fall to half of a month's crush demand.

Outrage over accusations of Brazilian price gouging erupted in dark corners of Chinese media this month. An October 25 article, "2 Million Tons of Soybeans Rot at Port! Brazil Gambled but Forgot China Already Held 3 Trump Cards," told a bombastic story of Chinese traders banding together during September to resist alleged price-gouging by Brazilian suppliers by postponing 8 million tons of sales and leaving 2 million tons of beans to rot on Sao Paulo docks. According to this account, Brazilians emboldened by their monopoly position demanded an increase in soybean prices that would have priced their beans at a $66 per ton premium over U.S. beans (a premium of about 11%--consistent with the fob prices reported above.) The author of the article claimed that China pressured Argentina to suspend its tax on soybean exports last month so Chinese traders could buy from Argentina as leverage against Brazilian price increases. Global news media reported this was an emergency measure to bolster Argentine foreign currency holdings. However, the timing of the tax suspension did coincide with the drop in Brazilian soy prices and so many Chinese buyers pounced on Argentine beans that the tax suspension meant to last more than a month was canceled within days.  

Chinese social media reactions to the article--widely posted on Chinese and Hong Kong sites--reveals that the China-Brazil relationship may not be as cozy as most outsiders presume. Here are sample comments: 

• "Is Brazil's short-sighted price increase a misjudgment of the situation and a risky gamble, or a display of confidence based on leverage?"
• "What kind of underlying strength lies behind China's calm response? The answer lies in the strategic chessboard that both sides have already laid out." 
• "Brazil is truly ungrateful and treacherous, burning bridges after crossing them."  
• "Seeing that we weren't buying American soybeans, they thought they had us cornered and arbitrarily raised soybean prices. Have they forgotten that they're not the only country in the world that produces soybeans?" 

A puzzling aspect of the Chinese market situation is that low prices and financial losses are not curbing Chinese soybean crush volumes. According to the NGOIC analysis cited above, volume by main crushing plants was 2.37 mmt during the week of October 24, up 200,000 mt from the previous week and up 100,000 mt from a month earlier. Similarly, there has been little reduction in hog and poultry production despite these producers also incurring losses. Feed demand is expected to remain strong into Q4. The peak demand season for meat and oils is during the January-February Chinese holiday period.

While Brazil's new harvest will begin in January--predicted to be even larger than this year--those beans are unlikely to effectively add to Chinese supplies during Q1 2026. Analysis of 2025 customs data from Brazil and China shows it took 2 months for Brazilian exports to show up as imports in China customs data. During Q1 2025 China's crushers scraped by and Chinese soybean meal prices spiked before Brazilian beans began arriving in April. 

It's not at all clear how many soybeans are in China's State reserves. China reveals nothing about the volume and estimates by USDA and other organizations outside China are wild guesses. Many soybeans in reserves are domestic soybeans purchased to support prices. This month authorities have been releasing domestic soybeans from reserves--thousands of tons with only tepid sales--but these beans are not competitively priced for use by crushers. There has been no indication from authorities that they will release imported soybeans from reserves in large enough volumes to effectively supplement supplies in December-January.

China Promotes International Food Safety Scheme for BRI Countries

A country with a bad food safety record aspires to lead a new approach to setting food safety practices in international trade. This is part of China's plan to leverage its Belt & Road Initiative in order to boost its influence in setting international rules, standards, and inspection practices. So far, it's off to a slow start.

On October 15, China's customs administration held a meeting of its 2-year-old "Import & Export Food Safety Cooperation Mechanism for the Countries of the Belt and Road Initiative" in Shanghai with participants from food agencies and embassies of 21 Belt and Road countries. 

Director General of the Customs Administration Sun Meijun stated that China's customs administration is willing to work with food safety authorities of all countries to collaborate on food safety regulation and promote safer and more efficient trade in food and agricultural products. At the meeting member countries affirmed the "Shanghai Declaration on Promoting Trade Facilitation and Sharing Food Safety" and launched a "Silk Road Food Safety" information platform.  

No, not a game show. 11 country reps + China Customs Director Sun signed the
terms of reference for China's import-export food safety initiative at the Shanghai meeting.

According to Director Sun, the food safety mechanism will:

• be guided by morality and rule of law 
• give food enterprises the primary responsibility for quality and safety
• adhere to scientific supervision that gives full play to international rules and standards
• strive for shared responsibility for food safety throughout the entire chain from farm to table. 

Sun also mentioned that this food safety initiative is part of China's aspiration to engage in global governance. She did not mention it, but the idea for the BRI food safety initiative dates back 10 years to the 2016-20 and 2021-25 five-year plans. 

China launched the "Import & Export Food Safety Cooperation Mechanism for the Countries of the Belt and Road Initiative" in 2023. At this month's meeting 11 new countries signed the charter, bringing the total member countries to 18. My arithmetic indicates there were only 7 countries before this month's meeting was held. China claims to have over 150 countries in its Belt and Road Initiative (BRI), so participation is not overwhelming. There does not seem to be a list of members, but countries mentioned in articles about the initiative include Indonesia, Belarus, Iran, South Africa, Turkey, Cambodia, Bolivia, Brunei, Kazakhstan, and Uzbekistan. 

Chinese Customs held a belt and road food safety training session in Shanghai during September 2025 
for attendees from Brunei, Mongolia, Pakistan, Serbia, Rwanda, South Africa, Papua New Guinea, and Panama

News about the October 15 Shanghai meeting was featured in several articles on the Chinese version of the customs web site and other Chinese state media. English articles in China Daily and other State media outlets briefly mentioned the Shanghai meeting, emphasizing granting of access to new products and downplaying the BRI food safety mechanism.

State media claims that food trade with BRI countries grew 2.5% this year. That was less than half the 6.2% growth in all trade with BRI countries.

In a world under China's food safety governance, look for inflexible and overly detailed traceability requirements, zero tolerances for certain substances, blanket bans of meat from an entire country when a disease outbreak occurs in a particular region, enforcement/inspections that oscillate between lax and excessively strict depending on China's market/political situation, and promises of efficient transmission of documents belied by numerous rejections of imported foods each month for documentation problems. In short, excessively complex requirements for which Chinese inspectors can always find a violation if they want to.

In September Chinese customs rejected 443 food shipments, but the list is released only in a Chinese pdf. Rejections included dozens of shrimp shipments from Ecuador containing sodium metabisulfite or animal disease, bird nests from Indonesia that contained aluminum, beef from Argentina and Brazil with incomplete documentation, bird nests from Vietnam with registration problems, milk chocolate candy from India with improper labels, shrimp from Pakistan with incomplete documents, non-GMO rapeseed oil from Kazakhstan containing GMOs, beef broth from Vietnam with salmonella, degraded pistachios from Iran, and beef from Mongolia with high bacteria counts.

U.S. Soy Exports to Non-China Destinations up 45% so far

U.S. soybean exports to non-China destinations have increased 45% year-over-year in the first 7 weeks of the 2025/26 marketing year. But that growth made only a slight dent in offsetting the lost demand from China's boycott of U.S. beans.

Analysis of USDA export inspection data for September through October 16--the first 7 weeks of the 2025/26 market year--shows that exports are overall down -2.5 million metric tons from the same period in 2024. Sifting through the USDA database shows that exports to China during this period last year were 4.2 mmt versus 0 this year. Exports to non-China destinations were 3.8 mmt in the first 7 weeks of MY2024/25, but they increased to 5.5 mmt so far in 2025/26. That's a year-on-year increase of 1.7 mmt, or 45%, but plugs less than half of the 4.2-mmt hole left by China's snub of U.S. beans. 

Most of the top overseas markets for U.S. soybeans have increased their purchases. The U.S. has exported soybeans to 34 destinations so far in MY 2025/26. The top markets are Mexico, Egypt, Bangladesh, Pakistan, and Japan, each of which registered increased sales year-over-year. Sales to Bangladesh and Pakistan each increased by about 400,000 mt from last year. Italy, Spain, Turkey, Taiwan, and Iraq registered increases ranging from 76,340 mt to 194,642 mt. Germany, the 6th-largest destination so far, had a drop in sales of nearly 240,000 mt. 

China is also a top buyer of U.S. sorghum, and the latest USDA report indicates that exports of sorghum for MY 2025/26 are down -346,397 mt year-over-year. On the other hand, MY 2025/26 corn exports are up 3.5 mmt and wheat exports are up 1.9 mmt year-over-year, despite lack of sales to China for these grains.

How Long Can Brazil Sustain China's Soybean Supply?

It's confirmed that Brazilian beans continued to almost single-handedly sustain China's soybean supply during September 2025--and actually increased supplies from the previous month. However, China probably cannot sustain its supplies year-round without importing U.S. soybeans. The Brazilian beans arriving in September represent the end of Brazil's peak shipping season. Brazilian shipments to China began to drop in August and September, which probably means Chinese supplies will begin to shrink in October and November. While Brazil is expected to have another monster harvest beginning in January, the new Brazilian beans probably won't clear Chinese customs until April.

As reported last week, China's September 2025 soybean imports increased by 592,000 metric tons from the previous month to reach 12.87 million metric tons (mmt). Detailed customs data confirm that China's imports of Brazilian soybeans increased by 476,000 mt in September, accounting for most of the increase. Brazil supplied 10.96 million metric tons (mmt) of China's September soybean imports during September, an 85% share (nearly the same as in August). Imports from Uruguay were up 239,000 mt and imports from Argentina were up 123,000 mt. China imported small volumes from Russia, Canada, and Ukraine. (Phantom imports from the U.S. reported by Chinese customs in August did not reappear in September.)  

As reported here last week, the volume of soybeans exported by Brazil to China in a given month roughly corresponds to the volume of Brazilian bean imports reported by Chinese customs 2 months later. However, the comparison does not match exactly and suggests that soybeans seem to have gained some weight somehow in their journey from Brazil to China. 

Brazil exports to China from Brazilian customs.
China's imports from Brazil from Chinese customs.

For example:

• In July 2025 Brazil reported exporting 9.58 mmt of soybeans bound for China. 
• In September, China reported that 10.96 mmt of Brazilian soybeans cleared customs--nearly 1.4 mmt more than Brazil had reported exporting two months earlier. 

The cumulative trade for 2025 so far suggests inflation of China's import volume by about 2.1 mmt

• From January to July 2025, Brazil reported exporting a cumulative total of 58 mmt of soybeans bound for China. 
• From March to September (a 2-month lag), China reported importing a cumulative total of 60.1 mmt of soybeans from Brazil--2.1 mmt more than Brazil reported exporting to China. 

It's evident from the chart above that July was the end of the peak export season for Brazil's soybeans. Brazil's August exports to China totaled 7.93 mmt, down about 1.6 mmt from July. In September Brazil exported 6.77 mmt to China, down 1.16 mmt from August. These monthly declines in Brazilian shipments should result in a drop in China's arrivals of soybeans in October and November. More declines are likely in December 2025 through March 2026. Purchases from Argentina earlier this month will arrive in early 2026 and only fill part of China's deficit if there are no purchases of U.S. soybeans.

China's Food Prices Under Downward Pressure

The food component of China's CPI for September 2025 was down -4.4% from a year ago, while the nonfood component was up 0.7%, according to a report by the National Bureau of Statistics. The overall CPI was down -0.3% from a year ago.

Prices were down from a year ago for most food categories. Pork (-17%), vegetables (-13.7%), and eggs (-11.9%) stood out with the largest year-over-year declines in price. Fresh fruit (-4.2%), edible oils and milk (both -1.4%) and grains (-0.7%) were also down year-over-year. 

While food prices in September were down from a year ago, prices were up 0.7% from the previous month (August). Vegetables, eggs, and fruit were up from the previous month.

The Food CPI is cyclical. This month's year-over-year declines reflect a reversal of increases that occurred a year ago, especially for pork and vegetables. A year ago, China's Food CPI was up +3.3% in September 2024, and it was down -3.2% in September 2023. Pork, in particular, remains highly cyclical, registering a 17% decrease in September 2025, a 16% year-over year increase in September 2024, and a -22% decrease in September 2023. 

Data from China National Bureau of Statistics.

The informal title of "Consumer Pork Index" still applies due to the role of pork price fluctuations in the CPI. According to the Statistics Bureau report, the decline in vegetable prices contributed -0.35 percentage points to the overall CPI decline, pork contributed -0.26 percentage points, and eggs contributed -0.08 percentage points.

The decline in pork prices has gained momentum during October. Wholesale prices started falling in mid-September. The average price for a lean pork carcass reported at Beijing's Xinfadi market declined from RMB 8.9 per 500g on September 9 to RMB 7.4 per 500g on October 18, a cumulative decline of nearly 17% in about 5 weeks. A number of videos on Chinese social media marvel at incredibly low pork prices in consumer markets around the country.

Average price for a lean pork carcass, Beijing Xinfadi.com.cn.

Industrial prices in September were down year-over-year: the producer price index for industrial products ex-factory was down -2.3% from a year ago. The index of raw material prices was down -3.1% year-over-year. 

The industrial producer price index for food products ex-factory was down -1.7% year-over-year in September. The textile industry PPI was down -2.4% and the clothing and apparel PPI was down -0.6% from a year ago. 

Pictures of Rain-Soaked Corn Harvest in China

 

College students harvesting corn in the rain near Jinan, Shandong.
Source: Jinan Times.

October 1, a student saw this when he returned home
to Qi County, Kaifeng City, Henan Province. Source: Huoxing Caijing.

Farmer prays for his 200 mu of corn soaked by rain. Frame from Douyin video.

Moldy corn in Henan Province. Grandpa spent RMB600 per mu to grow corn
and can sell it for RMB 1 per kilogram. Douyin video frame.

Drying corn on the roadside in northern Anhui Province. Douyin video frame.

Combine harvesting in a flooded field. Douyin video frame.

Getah Virus Spreading in China's Pigs: "Worst Crisis Since ASF"

 China's swine industry is struggling with an epidemic of Getah Virus, also known as GETV (盖塔病毒). One video posted on Chinese social media calls GETV "The biggest crisis since African swine fever." 

The mosquito-borne virus can infect entire farms, causing diarrhea, staggering movements, and discoloration of skin. It causes sows to abort and reduces survival rates of weaned piglets. An article appearing in mid-September reported that the virus had been detected on pig farms in Guangdong, Fujian, Jiangxi, Henan, and Sichuan Provinces. It has also appeared in Hebei. Most information about the current outbreak comes from farmers posting short videos on Douyin (China's Tick Tock) about GETV outbreaks and sharing guidance for avoiding it. Videos posted as recently as yesterday show barns filled with dead pigs, excavators dumping live pigs into burial pits, sows with blotches on their skin, and pigs staggering around a pen.

Thumbnails of videos about GETV outbreaks posted on Douyin yesterday.

The GETV outbreak does not appear to be mentioned in any official news media, pig industry websites, or market analysis reports. Last month's article cited monitoring by China's Animal Health and Epidemiology Center as showing that GETV is spreading, but I cannot even find a web site or any online reports by this organization. Today, the Ministry of Agriculture and Rural Affairs held a videoconference on upgrading work on swine quarantine and slaughterhouse monitoring, but there was no mention of GETV or any other specific disease. Local officials were ordered to take prompt action and proactive measures to improve animal disease prevention, find new ways to supervise slaughter in small facilities, and plan work for the New Year and Spring Festival holidays. 

Getah Virus was first discovered in mosquitos around Malaysian rubber plantations in 1955 (Getah is the Malay word for "rubber") and has since spread across Eurasia and the Pacific region, evolving into multiple strains. Worldiwde, the virus is more common in horses (for whom it is not lethal) than in pigs. GETV does not cause illness in humans, but antibodies against the virus have been found in humans.

 The virus was first isolated in China during 1964. Scientists in China have published dozens of academic studies of the virus. Scientific papers indicate the virus has impacted commercial swine in China for years, including a study that found 1.3% of samples collected in Shandong Province during 2022-23 were infected and an epidemiological study using samples collected from 16 provinces in 2021-22. A July 2025 paper published in the scientific journal Virulence documented an epidemic of GETV on farms in 21 of 157 counties in Henan Province during July to September 2024. The Henan study's authors speculated that last year's spread of the virus could have been even wider than they had detected. This year's epidemic also began in Henan and has spread to at least four other provinces. 

The Virulence study's authors reported that the 2024 outbreak originated in Nanyang, a region of Henan that also happens to be headquarters for China's largest swine-producing company. The authors also warned obliquely that small farmers purchasing pigs from large companies is a practice that heightens the risk of transmission. The stern warnings issued to large hog companies over the last 5 months to ban selling pigs for "secondary fattening" may have actually been meant to stop the spread of GETV (it was described as a measure to reduce excess supply).

The spread of GETV is linked to mosquito activity which explains its concentration during summer months in southern provinces. Mosquito density 25% higher than normal following this year's extensive typhoons and flooding may have contributed to this year's GETV epidemic.

It is common for early information about epidemics to be spread by anecdote. In past epidemics authorities covered them up until they no longer could be hidden. In 2018, the African swine fever virus had been circulating in China for 2-to-3 months before the first official case was announced in August of that year. PRRS ("blue ear virus") spread for about a year in 2006-07 before it became a national crisis in the Spring months of 2007. 

The usual pattern is for pork prices to fall in the outbreak's initial phase as pigs are culled en masse and infected pigs are illegally slaughtered and sold in the market. The GETV outbreak may be partially responsible for crashing pork prices this fall. The November 2025 contract on the Dalian Commodity Exchange fell nearly 20% between August and mid-October. After the first round of sow deaths/culls impacts supplies 6-to-8 months later pork prices skyrocket. Hog contracts for 2026 also declined sharply over the last 2 months but the September 2026 contract is trading at a 23% premium over the November 2025 contract.

November hog futures on Dalian Commodity Exchange

This virus appears to be mosquito-borne. On one hand, heavy rains across northern China and resulting standing water could contribute to spread to northern provinces. On the other hand, cold weather could bring some relief by reducing mosquito populations. Big swine producing companies raising pigs in enclosed buildings claim to be free of the virus. The current outbreak is likely to add momentum to the consolidation trend that is pushing independent hog producers out of the business. 

Weak China Corn Market Could Get a Jolt from Mold Problem

China's corn prices have been under downward pressure, but there are early signs of a turnaround in the market due to quality problems in the northern plain region. 

On October 14, the Dalian futures price closed at RMB 2093 per metric ton, down 5.5% from its September 8 peak.

China Dalian Commodity Exchange.

 A Feed Industry Information Net report today reported the national average cash price for corn was RMB 2,201.70, down 4.19% from a week earlier. The increased volume of new corn coming on the market is driving down prices, the report said. The agriculture ministry estimates that the corn harvest is more than 50% complete. Corn output estimated to be up this year due to a slight increase in area and yield improvements achieved by a nationwide campaign to raise grain yields that was declared by the communist party's "Document No. 1." Buying is cautious despite a stubbornly high swine inventory and August feed output of 20.36 million metric tons that was up 3.7% from the previous year. 

A separate analysis posted on several sites Monday predicted that China's corn prices could soon turn upward in the northeastern region. The analysis noted that northeastern farmers will soon cut back their sales of corn as falling prices are now approaching the production cost. When profits disappear they will be less eager to sell. Second, the analyst observed that companies are converging on the northeast to buy corn because corn quality has been degraded in Shandong Province and other parts of the northern plan corn belt where heavy rains have been falling since mid-September. As competition for good quality corn in the northeast region heats up, the price will rise. According to the analyst, businesses in the northeastern region are beginning to feel a sense of crisis and will have to raise prices in order to buy enough corn for their needs.

The Feed Industry Information Net analysis also cited heightened risk of mold in north China as drying capacity is insufficient, and piles of newly harvested corn are getting wet. That analysis predicted that a monthly decline in corn prices during October is likely but advised readers to pay close attention to weather conditions during the harvest period.

China's Soybean Imports Increased to 12.9 mmt in September. How?

China imported 12.9 million metric tons (mmt) of soybeans in September 2025, according to summary data released by the customs administration. The import total was up from the previous month's 12.3-mmt total, and it was the 2nd-highest-ever monthly volume after May's 13.9 mmt. 

China is still importing nearly all of its soybeans from Brazil, a pattern that surely continued in September. China has not yet released detailed data that will reveal the source of beans imported in September, but it is surprising that imports increased from the previous month with South American supplies shrinking after the Southern Hemisphere marketing season passed its seasonal peak. 

The chart below shows that China's monthly fluctuations in imports have reflected changes in imports from Brazil over the last 2 years. Last year China's imports from Brazil peaked in August and began declining month-to-month by 2-mmt during Sept-Nov. This year imports from Brazil peaked in May at 12.1 mmt and were between 10.4 and 10.6 mmt during June-August. The seasonal pattern suggests a decline in imports from Brazil in September.

Data from China Administration of Customs.

The chart below overlays China's imports from Brazil with Brazil's exports of soybeans to China. There seems to be a consistent 2-month lag between Brazil's exports and China's imports of Brazilian beans.  Brazil's monthly soybean exports to China began falling in July, fell about 2.7 mmt in August and fell about 1.4 mmt September (Brazil releases its customs data earlier than China does). Brazil's July exports suggest a China import volume from Brazil of about 9.6 mmt in September. Given a total of 12.9 mmt, that suggests about 3.3 mmt came from other sources in September.

Data from China and Brazilian customs.

For reference, the most recent detailed China customs data for August 2025 show 10.5 mmt of the 12.3-mmt import total came from Brazil. If imports from Brazil declined to 9.6 mmt in September, imports from other sources -- Argentina 1 mmt in August, Uruguay 444,000 mt in August, Russia 46,000 mt in August, Canada 22,000 mt in August, and Ukraine 4,000 mt in August -- would have to double to achieve the September import total of 12.9 mmt. (China also reported 227,000 mt of imports from the U.S. in August even though no U.S. exports to China have been reported since April--perhaps these were stuck in prolonged inspections or released from bonded warehouses). 

We'll find the answer next week when detailed data are released.

RMB484mil Disaster Relief and Expedited Insurance Payouts for Rain-Soaked Harvest

"Wet soil and waterlogged farmland have hindered the movement of agricultural machinery, negatively impacting harvesting, drying, and clearing stubble for wheat sowing," according to official Chinese news media. The Xinhua report proclaimed, "We must unite our efforts to protect autumn crops and strive to overcome disasters and achieve a bumper harvest!"

A Xinhua reporter claimed to see crawler-type harvesters working nonstop. Source: Xinhua.

A special meeting on agricultural insurance indemnities was held on October 10 to consider how to speed up insurance payments to farmers impacted by heavy rains in the Huang-Huai region of northern China. The meeting was held to address complaints about slow processing of agricultural insurance claims and low payouts. Insurance companies were instructed to expedite claims, use remote sensing and drones to verify losses, pay the full amount promptly, and ensure that grain is harvested and dried. 

The meeting was convened jointly by the Planning and Finance Office of China's Ministry of Agriculture and Rural Affairs (MARA) and the Property Insurance Supervision Department of the State Financial Supervision and Administration Bureau. Companies engaged in agricultural insurance attending the meeting were ordered to improve their sense of responsibility and level of service. The State Financial Supervision and Administration Bureau will monitor payouts and threatened companies slow to process claims with punishment. Companies attending including PICC Property & Casualty Insurance, CPIC Property & Casualty Insurance, China Property & Casualty Insurance, China Life Property & Casualty Insurance, Ping An Property & Casualty Insurance, Zhongyuan Agricultural Insurance, Guoyuan Agricultural Insurance.

China's Finance and Agriculture Ministries issued RMB 484 million (US$ 67 million) in agricultural disaster relief funds on October 11 to provinces impacted by heavy rains, according to the web site of the Ministry of Agriculture and Rural Affairs. Funds are to support early harvesting by agricultural machinery, drying of wet grain, drainage of farmland, and moisture-resistant sowing of winter wheat to ensure a good harvest of autumn grain and a good storage of every grain. Seven provinces received funds, including Hebei, Shanxi, Jiangsu, Anhui, Henan, Shandong, and Shaanxi.

Grain drying enterprise in Hebei Province. Source: Xinhua.

China's Fall Grain Harvest Stuck in the Mud

Grain harvesting equipment can't get into muddy fields and the corn crop is at risk of mold due to heavy rains across much of northern China. This is also China's main winter wheat region, so delays in planting in flooded and waterlogged fields could impact next year's wheat crop. While corn prices in China have been under downward pressure and imports of corn and wheat have been minimal over the past year, this weather event could tighten up China's grain markets.

On October 9, the agriculture ministry and meteorological administration issued a warning for October 10-12 of continuous rain and waterlogging of farmland across parts of Northern and Northwest China and parts of the Huanghuai region. An "orange alert" was issued for Xianyang, Tongchuan, and Weinan in Shaanxi Province; Linfen, Yuncheng, Changzhi and Jincheng in Shanxi Province; Xingtai and Handan in Hebei Province; and Dezhou and Binzhou in Shandong Province.

Soil moisture October 9. Blue indicates excessive moisture.

The rainy weather notice advised farmers in high-risk areas to promptly harvest crops and exhorted them to dry grain and use ventilation to prevent germination and molding of grain post-harvest, promptly drain waterlogged fields and prepare land for autumn sowing of over-wintering wheat crops. 

Rainy weather during the fall harvest season is rare in these regions where most rain is concentrated during summer months. Many of these regions suffered from drought during last winter and spring, but a record wheat crop was nevertheless reported during the summer months.

Minister of Agriculture Han Jun inspected difficulties harvesting corn and preparing to plant the winter wheat crop in Henan Province on October 8-9. Minister Han commended upgrades to harvesting equipment in Zhoukou City to enable machinery to access fields by substituting larger wheels and using 4-wheel drive and tractor crawler equipment. Han also stressed the need to deploy grain drying equipment to farms and storage facilities to prevent soggy grain from molding. Han exhorted local officials to improve drainage ditches and to improve agricultural disaster prevention, mitigation, and relief capabilities utilizing "comprehensive grain service centers." 

Minister Han discusses tractors that can navigate muddy fields in Henan Province.
The rain apparently stopped for this photo, and no one has mud on their shoes.

Han stressed the need to plan for winter wheat planting, to increase the supply of seeds and fertilizers and to guide farmers on avoid impacts of excess soil moisture on wheat plants and late-sowing of wheat to ensure that winter wheat planted area remains stable. 

Minister Han's remarks raised concern over grain markets by emphasizing the importance of grain price stability, ensuring reasonable net returns for grain farmers, and coordination of grain procurement and insurance claims. 

State media in Hebei Province reported using 186,000 crawler-type harvesters since conventional equipment cannot access fields. These tractors can harvest over 100 mu per day--about 16 acres. 

The State Administration of Food and Commodity Reserves also issued a notice on October 9 demanding that grain purchasing and storage officials in provinces hit by rains prioritize grain procurement, coordinate deployment of grain drying equipment to farmers, ensure grain is stored in waterproof facilities, monitor risks of mold and toxins in grain, and the step up coordination of policy and market procurement and state and local procurement, and carry out targeted procurement and disposal of substandard grain. 

The notice advised officials to prepare to implement the minimum price procurement policy for rice, probably an indicator that rice prices are near the minimum level and also to avoid mixing substandard rice in State reserves. 

A wheat expert interviewed by Farmers Daily acknowledged the delay of corn harvesting and winter wheat planting, then emphasized that rains will replenish moisture in soil and aquifers, improving growing conditions for next year's wheat crop. He pointed out that extensive flooding in Henan Province during 2021 was followed by a big wheat harvest the following year.

13% of Wheat Purchased at Support Price

China purchased 13 million metric tons of wheat through its minimum procurement price program this year, according to the director of the State Administration of Food and Commodity Reserves. Purchases were made in provinces of Henan, Anhui, Hebei, and Shandong. 

The director also announced that a total of 100.16 million metric tons of wheat has been procured during the peak marketing season. Thus, 13% of this year's crop was purchased at the minimum price and stored in government reserves.

The director said wheat procurement began early this year and proceeded smoothly as most farmers sought to sell their grain as soon as it was harvested. The minimum price program gave farmers a "bottom line" that guaranteed that farmers could sell their wheat at a good price, the director said.

The minimum price for wheat this year is RMB 2,380 per metric ton for grade 3 wheat. The Chinese support price works out to US$ 9 per bushel at the current exchange rate. By comparison, the futures price for U.S. wheat is currently about $5.07 per bushel.

The simple average of procurement prices paid for all wheat reported weekly by the Administration of Food and Commodity Reserves from May to September was RMB 2,410 per metric ton.

China reported producing 138.16 million metric tons of wheat this year, so 9.4% of all wheat produced in 2025 was purchased at the minimum price. (The minimum price program only operates in 5 provinces representing about 82% of wheat output.)

The value of the wheat purchased at minimum price is RMB 30.94 billion ($4.3 billion at the current exchange rate). 

A calculation with simple assumptions shows that the value of wheat purchased at minimum price was 8.5% of the value of wheat produced in China this year. 

China Could be Facing a Farm Crisis

U.S. news media are reporting that China's soybean boycott is driving American farmers into financial trouble, but China could have a farm crisis of its own brewing. Chinese authorities quietly pared back imports of corn and wheat last year to insulate its farmers from worldwide downward pressure on farm prices. But the country's flood of imported Brazilian soybeans this year pressures prices of Chinese soybeans, with knock-on effects on prices of other crops.

Several years ago Chinese authorities fretted about low profits undermining grain production incentives. Since then, farm prices have fallen further and the country's new cadre of scaled-up farms have a bloated cost structure. Now Chinese authorities have stopped publicly talking about the problem, likely an indicator that the problem has become even more acute. 

As China's fall harvest gets underway crop prices are low and under a new round of downward pressure. The average price for corn--China's largest crop--reported Sept 23 by China's Food and Commodity Reserves Administration was RMB 2,235 per metric ton, close to last year's price, but down 20% from September 2023. Chinese corn prices have fallen after harvest during October-December during the last two years and could do so again as new crops come on the market. During September there was a slight downward trend that signals another seasonal decline as the harvest gains momentum. 

Data from China National Administration of Grain and Commodity Reserves.

Prospects for price declines on the horizon are evident from corn futures. The November 2025 corn futures contract on China's Dalian Commodity Exchange peaked in the first week of September at RMB 2231 per metric ton and dropped about 4 percent to RMB 2143 by the end of September. That's below the September contract that closed out at RMB 2,285 last month. These prices suggest lower corn prices are indeed expected over the next two months

Chart shows daily high, low and closing prices on the Dalian Commodity Exchange.

A corn market analysis by China's Feed Information Net this week reported a 2.57% decline in the cash price during September as new corn came on the market and accumulated at northeastern ports for shipment to the south, traders began selling inventories of old grain more freely, and poor profitability constrains feed mill purchases. A major uncertainty is impact of wet weather across northern China that hindered drying down of corn and resulted in mold in some areas. 

China's soybean producers are also facing lower prices than last year. While Chinese corn prices rebounded in H1 2025, there was not much of a rebound in soybean prices. The late September farm price for China's soybeans was down about 11.4% from a year ago and down 23% from two years ago. There was a slight downward trend during September, also suggesting further declines as the harvest progresses this fall.

Data from China National Administration of Grain and Commodity Reserves.

The November No. 1 soybean contract on the Dalian exchange peaked on September 8 at RMB 3,977 and was down about 1.3% by the end of the month. The November soybean futures price is about 3.4% below where the September price ended up, suggesting more declines are expected. 

Chart shows daily high, low and closing prices on the Dalian Commodity Exchange.

Chinese rice prices, both indica (long grain) and japonica (medium grain), also show signs of decline heading into fall harvest. It looks likely that authorities will activate minimum price purchase programs for rice as prices approach the support price level of RMB 2580 for indica and RMB 2620 for japonica. Rice prices saw sharp declines in October last year that contrasted with the unusual October-November increases during 2023.

Data from China National Administration of Grain and Commodity Reserves.

Data from China National Administration of Grain and Commodity Reserves.

China's official cost of production survey in 2023 (the most recent data) showed Chinese corn and single-season rice producers making profits, wheat producers close to breakeven, and producers of soybeans, rapeseed, and double-cropped rice losing money. The decline in crop prices since then (evident in the charts above) likely eroded profitability for Chinese farmers. Lack of profits is often cited obliquely in government discussions as a challenge for maintaining national food security. Shrinking profitability likely contributed urgency to the agriculture ministry's campaign to raise crop yields based on the idea that higher yields will reduce per-ton production costs and improve profitability for farmers. 

The official cost survey understates the cost structure for "new type" scaled-up farm operators who replace unpaid family labor with higher cash expenses for machinery and fuel, buy expensive high-yielding seeds, and pay cash rent for their land. While the cost survey includes land rental of about RMB 200 to 400 per mu, a China Agriculture University article reported rents ranging from RMB 400 to 800 per mu in various regions for grain crops (land used for vegetables and bananas brings higher rents). 

Since the elimination of agricultural taxes 20 yeas ago, China's small-scale farmers have paid nothing for the land allocated to them by their village collective if they cultivate it themselves. Now authorities are pushing schemes to consolidate and transfer village land to scaled-up farms that include payouts to villagers to keep them happy after giving up their land. These payouts become a cash expense for the farming operations that take over the land.

The rapid expansion of scaled-up farmers who pay villagers for their farmland means that land rents are undermining the economic viability of grain production in China. The 2022 China Agriculture University article cited above observed that land rent accounted for half of grain production costs for scaled-up farms. That 2022 article noted that land rents raised the cost of wheat above the price of imported wheat, and its authors warned that a 10% drop in grain prices would wipe out profits for scaled-up grain farmers. Unprofitable grain ignited panic in authorities about the diversion of land away from grain production, prompting them to hire teams of rural thugs to force farmers to plant grain crops, knock down buildings and uproot fruit trees to maximize land area planted in grains. 

Since 2023 the teams of rural thugs have quietly disappeared, but Chinese wheat, corn and soybean prices have dropped by 20%, while rice prices have dropped 5%-to-10%. The scaling-up of farms and encouragement to adopt expensive machines and "smart-farming" equipment continues. A 2024 21st Century Business Herald article reported rapid growth in farmland transfers by various methods and estimated that about half of China's cropland was leased to large-scale farmers last year. 

Discussion of the role of land rents in China's grain production has disappeared from news media and academia during the last 3 years. The absence of discussion in state-controlled media is probably an indicator that it is a worrying problem that authorities want to cover up. 

China's establishment of a commodity pipeline with Brazil appears quite successful by facilitating China's trade war boycott of U.S. commodities. However, the China-Brazil hookup may prove to be more fragile than expected if Chinese authorities panic over low crop prices and notice that relentless expansion of output and exports from South America boosts world supplies and puts downward pressure on prices. In particular, China's quest to boost domestic soybean production--cited by the ag ministry as a major achievement during the 14th 5-year plan--looks doomed as Chinese soybean prices drop faster than any other crop price, further eroding production incentives.