Signal Dry Weekly: China shifts to South American soy

Chart of the Week: China Shifts to South American Soy, U.S. Corn Rises to Japan

This week we take a closer look at the shifting grain flows of 2025, as U.S.–China trade tensions continue to dominate global perspectives. Agriculture remains at the core of these frictions, with China’s move away from U.S. soybeans becoming increasingly evident and Brazil solidifying its role as the leading supplier.

As highlighted in our July Commodity Radar report, this shift aligns with China’s strategic goal of reducing reliance on the U.S. for agricultural imports. Since 2022, the U.S. has lost a significant share of China’s soybean purchases, while Brazil and increasingly Argentina have stepped in to fill the gap. Latest TSOP data show that U.S. soybean exports to China collapsed to just 783,000 tonnes in Q2 2025, down 85% from the previous quarter and 67% lower year-over-year. This effectively represents a near-cessation of flows, underscoring the severity of the structural decoupling.

Recent reports suggest Chinese processors could import up to 10 million metric tons of soybeans from Brazil and Argentina during the 2025/26 marketing year, which would mark a record. When looking at the grain flows, we can see that on Brazil–China soybean flows are maintaining strong seasonal flows, while Argentina is also emerging as a complementary supplier.

Meanwhile, the U.S. soybean sector faces structural challenges in regaining lost market share in China, despite strong domestic demand. However, a new development is emerging Japan has deepened its partnership with U.S. corn exporters. Following the July 2025 trade agreement in which Japan committed to purchasing approximately $8 billion in U.S. agricultural goods, including corn, soybeans, fertilizer, bioethanol, and sustainable aviation fuel, Japan is now positioning itself to broaden its import strategy, with policymakers considering expanded usage not only in feed but also for renewable energy and broader agri‑industrial applications.