Soybean Futures Fall on US-China Trade Deal Doubts

Soybean futures declined to around $12 per bushel, retreating from recent two-year highs, as doubts surrounding a US-China trade agreement weighed on prices. The drop followed China's failure to confirm the Trump administration's assertion that Beijing had committed to purchasing at least $17 billion in US agricultural products annually through 2028, in addition to its current soybean pledges. Prices had surged on Monday after the White House announced the deal, which came after discussions between President Donald Trump and Chinese leader Xi Jinping in Beijing. However, China’s Ministry of Commerce stated on Wednesday that the two countries had merely established a “guiding target” to increase agricultural trade, without mentioning the $17 billion figure. While US farmers welcomed the potential demand boost, they still face pressure from low crop prices, high production costs, Trump’s tariffs, and rising fertilizer expenses tied to the Middle East conflict.

Soybean futures steadied around $12 per bushel following a recent surge on May 18, after new details emerged from Donald Trump’s two-day summit in China regarding agricultural trade commitments. The White House said that China agreed to purchase at least $17 billion worth of US agricultural products annually through 2028, intended to supplement earlier soybean purchase agreements. After Trump’s meeting with President Xi last year, China had initially committed to buying 12 million metric tons of soybeans, alongside a broader pledge to purchase 25 million tons annually for three years. While the announcement was largely welcomed by US farmers seeking clearer demand signals following the summit, they still face persistent pressure from relatively low crop prices and elevated production costs in recent years. These challenges have been further intensified by Trump’s tariffs and rising fertilizer costs linked to the broader conflict in the Middle East.

Soybean futures fell to below $12 per bushel, following a 3% drop in the prior session as traders remained cautious despite potential large-scale Chinese purchases of American agricultural goods. US Trade Representative Jamieson Greer said China is expected to make “double-digit billion” annual purchases of US farm products over the next three years, while President Donald Trump said Beijing would buy “a lot of soybeans” from US farmers. Greer also pointed to an existing agreement for China to purchase 25 million tons of US soybeans annually over the coming years. Still, sentiment remained restrained as markets awaited concrete details on the timing and scale of purchases, after the first day of talks between Trump and Chinese President Xi Jinping failed to produce confirmed trade commitments. Meanwhile, the USDA projected US soybean stocks to decline to 310 million bushels by the end of the 2026 to 2027 marketing year, down from 340 million expected at the end of the current season.