China Agreement Leaves More Questions Than Answers

Authors: CoBank’s Jacqui Fatka, Rob Fox, Tanner Ehmke and Emmie Noyes.

Reprinted with permission from CoBank’s weekly newsletter KED Gleanings (December 1, 2025)

The one-year trade truce between President Donald Trump and Chinese President Jinping Xi provided welcomed news last month with China reportedly pledging to resume purchases of U.S. agriculture products, namely soybeans. As part of a wider trade agreement, China committed to purchases 12 MMT of soybeans from the U.S. during the last two months of 2025, with purchases of 25 MMT/year for the next three years, the White House fact sheet detailed.

It’s been widely reported that the agreement falls far short of China’s traditional purchases from the U.S. that have averaged 28 MMT over the last 10 years, indicating China has agreed to do no more than they’ve done in the past.

China’s pledge to buy 12 MMT by the end of 2025 has raised questions of logistics and if the pledge can be fulfilled in a narrow window. Although the U.S. has shipped greater tonnages to China in the November-December window, soybean shipments to the Pacific Northwest have been relatively quiet with train cars dedicated to the Gulf and interior export program. A reshuffling of cars, vessels, and Mississippi River barges would be needed to fulfill the purchase. Shipping 12 MMT would require about 200 vessels. Delivery to port would require 1,100-unit trains, or 550 flotillas on the Mississippi River at a time when water levels remain low. Delivery would most likely be executed via a combination of rail to the PNW and barges on the Mississippi River. 

Ahead of the meeting between Trump and Xi, China had purchased 180,000 MTs of soybeans for delivery in late December and January as a good-faith purchase. The January delivery implies that China’s soybean needs are covered through December following record imports from Brazil, raising questions over whether the pledged purchase of 12 MMT will be shipped by the end of 2025. Soybean port stocks in China are already ample.

Favorable soybean basis in the U.S. versus Brazil lends support to the idea that China will follow through on purchases. With U.S. soybean basis cheaper than Brazil, Chinese crushers will be able to lower their soybean cost, assuming China’s tariffs on U.S. soybeans are lifted. The window of opportunity, though, will close with the arrival of the Brazilian harvest in mid-January.

The fact sheet did note China will resume purchases of U.S. sorghum. In addition, all the retaliatory tariffs imposed by China since March 4 will be suspended. “This includes tariffs on a vast swath of U.S. agricultural products: chicken, wheat, corn, cotton, sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables, and dairy products,” the fact sheet said.

CoBank says: The truce between Trump and Xi is positive as it halts the escalation of tariffs, but lack of details on enforcing the agreement raises speculation on its value and durability. In June, Trump announced a successful truce with Xi that was followed by further escalation. China also did not follow through on purchases pledged in the Phase 1 agreement in 2020. If China does not follow through on these new promised purchases, will the U.S. resume the trade war? What happens in one year when the agreement expires? This latest agreement leaves more questions than answers.

The Update: Sales to China Mostly Absent in Export Sales Data

(Note: Since the writing of this article, China has bought at least 10 cargoes of soybeans from the U.S. See the Reuters update story here).

Intro: After its longest shutdown ever, the federal government data dump started Friday, November 14 with the updated World Agricultural Supply and Demand Estimates and U.S. crop production reports. On Monday, November 17, soybean futures rallied 25-30 cents on news that China bought another seven to nine cargoes, with most in the May-July timeframe. On the 14^th, the administration also adjusted its reciprocal trade policy, dropping tariffs on fertilizer and other agricultural imports. Also, in this edition there is more insight into the credit situation for the Corn Belt, as well as perspectives from national agricultural lenders on the deterioration of working capital on farms.

Follow the Data…

USDA dumped a trove of data last week on export sales that had not been announced due to the government shutdown. From Oct. 2 to Nov. 12, Chinese purchases of U.S. soybeans were minimal.

USDA reported that during the lapse in government funding, the U.S. made two sales of soybeans to Chinese buyers since the trade truce on Oct. 30. The first sale of 100,000 MTs was on the day of the agreement with the U.S., and the second purchase of 232,000 MT occurred on Nov. 3 with no confirmed purchases reported since then. Both sales were likely to state-owned firms like Sinograin or Cofco International. Soybean sales to unknown destinations since the day of the truce totaled 355,000 MTs, which could also be to China.

The slim sales of soybean to China are notable considering the White House proclaimed that China had pledged to buy 12 MMT of U.S. soybeans by the end of the year in the Oct. 30 trade truce. However, the Chinese Ministry of Commerce last week did not confirm the commitment in a press conference, and no official agreement has been seen in writing. China also left a 13% tariff on U.S. soybeans following the truce, adding nearly $1.50/bushel to the cost of U.S. soybeans going into China and making U.S. soybeans less competitive to Brazilian origins.

CoBank Says: The absence of confirmed soybean sales to China, along with differing accounts from the White House and Beijing regarding the specifics of recent agreements, raises questions about the outlook for future soybean transactions with China. With offers from Brazil being more competitive than those from the U.S., combined with the new Brazilian harvest arriving in mid-January, new sales of U.S. soybeans to China by the end of the year are becoming increasingly unlikely.