China Pens Argentine Soymeal Test Deal With Eye on U.S. Trade War Disruption

By Ella Cao, Naveen Thukral, and Maximilian Heath

BEIJING/SINGAPORE/BUENOS AIRES, June 26 (Reuters) – Chinese firms have booked the first soymeal cargo from Argentina since Beijing approved Argentine imports in 2019, as China’s animal feed industry looks to broaden its supply options to mitigate potential disruptions from the U.S.-China trade war.

Several Chinese feed makers have jointly signed the deal to purchase 30,000 metric tons of Argentine soymeal for July shipment, four trade sources told Reuters on Thursday.

“This is just a test case,” said one Singapore-based trader at an international trading company, which sells soybeans to China. “If it goes through China’s inspection and quarantine, we expect more deals.”

The cargo, purchased at $360 per ton on a CNF (cost and freight) basis, is expected to arrive in southern Guangdong province in September, the sources said.

China is the world’s biggest consumer of the protein-rich animal feed raw material but produces most of it by crushing soybeans mainly imported from Brazil and the United States. Argentina is the world’s top exporter of soy oil and meal.

Chinese buyers have been scooping up Brazilian soybeans and shunning U.S. exports due to high tariffs imposed during the ongoing trade war between Beijing and Washington.

Argentina’s oilseed crushing and export chamber told Reuters on Wednesday it had met with a travelling Chinese delegation, including the director of China’s National Food and Strategic Reserves Administration Liu Huanxin to discuss soymeal exports.

“We spoke at length about the feasibility of exporting soybean meal, and he seemed open to it if commercial conditions allow,” said Gustavo Idigoras, head of the CIARA-CEC chamber.

The Singapore-based trader told Reuters that the Chinese feed makers’ purchase from Argentina was part of an effort to safeguard supplies in the event the trade war has a lasting impact on imports of U.S. soybeans.

Lower prices for Argentine meal compared with the locally produced product were also encouraging the move, traders said.

China opened its market to Argentine soymeal in 2019 after years of resistance that was motivated by a desire to protect its domestic crushing industry. Market participants at the time said the decision was prompted by the U.S.-China trade war during U.S. President Donald Trump’s first administration.

Despite the approval, no purchases of bulk cargoes of Argentine soymeal had been recorded until now, according to Chinese customs data.

Argentina’s Idigoras hinted that there may still be some steps to finalise any soymeal deal formally and that the China market remained a “complex” and tough to crack, given Beijing’s preference to crush its own beans.

“There are many inquiries from Chinese firms over Argentine meal, but for now we have no confirmed transactions,” he said. “Argentina exported 30 million tons of soymeal last year, so has very significant supply capacity for China’s needs.”

China imported just 30,000 tons of soymeal for the entire year in 2024, mainly from Denmark, customs data showed.

(Reporting by Ella Cao in Beijing, Naveen Thukral in Singapore and Maximilian Heath in Buenos Aires; Editing by Joe Bavier, Adam Jourdan and Marguerita Choy)