1. Weekly News

Argentina

Argentina's Temporary Export Tax Removal Triggers Flurry of Chinese Soybean Purchases

Argentina's government has temporarily suspended its 26% export tax on soybeans in a bid to accelerate foreign sales and attract US dollars, a move that prompted an immediate and significant response from China. Chinese buyers moved swiftly to book around 20 cargoes of Argentine soybeans, totaling roughly 1.3 million metric tons (mmt), with majority for Nov-25 delivery and around 20% for shipment next year from the new Argentinian crop that will be harvested from Apr-25. This development deals another major blow to United States (US) farmers, as these purchases fall squarely within the fourth-quarter window that is traditionally dominated by US exports. The policy, which is set to last through Oct-25 or until a USD 7 billion export cap is reached, has made Argentine soybeans highly competitive on the global market. The flurry of sales to China reinforces Beijing's ability to source its needs entirely from South America, further sidelining US producers who remain locked out of the market by high retaliatory tariffs. While the tax holiday is expected to incentivize a rush of sales from Argentine farmers needing cash for the next planting season, it has also raised concerns about diverting raw beans away from the country's domestic crushing industry.

Argentina's Temporary Export Tax Removal Push Exports To Seven-Year High

The temporary suspension of Argentina's 26% export tax on soybeans triggered a surge in exports, pushing declared exports for the 2024/25 season to a seven-year high of 10.5 mmt, ahead of the previous record of 10.1 mmt achieved in 2018/19. The policy prompted a surge in buying activity from key international customers. China capitalized on the tax-free window to make large purchases of raw soybeans, while India made its largest-ever purchase of Argentine soyoil in a two-day period, securing 300,000 mmt. While the measure successfully stimulated export declarations, it was met with criticism from some farm leaders for creating market bottlenecks that pressured prices paid to farmers. A key consequence of the policy is that many export companies declared sales before securing the corresponding physical grain. As a result, these companies must now actively buy from local producers to fulfill their commitments. However, this dynamic is expected to keep the domestic market active and support prices above their pre-pause levels even after the tax is reinstated, benefiting local producers.

Brazil

Brazil's Soy Crushing Capacity to Expand by 8% Driven by Biofuel Mandates

Brazil's soybean processing sector is poised for a significant expansion, with industry association Abiove announcing planned investments of USD 1.11 billion (BRL 5.9 billion) over the next 12 months. This substantial capital injection is expected to boost the country's annual crushing capacity by 6 mmt, an 8% increase, potentially pushing total capacity above 80 mmt. The primary driver for this growth is the strong and rising domestic demand for biodiesel. Soybean oil is the feedstock for approximately 75% of Brazil's biodiesel, and the government's mandate for a 15% blend in diesel is expected to increase in the future. This policy is directly fueling the investment in processing infrastructure by major players like Bunge, ADM, and Cargill. The expansion will strengthen Brazil's position as the world's third-largest soybean processor and reflects a strategic shift towards adding more value domestically to its soybean harvest. The industry's idle capacity is already decreasing, signaling high utilization rates and a robust demand environment.

Brazil's Record 2025/26 Soybean Harvest to Squeeze Farmer Profitability

Brazil is projected to produce another record-breaking soybean harvest of 175 mmt in the 2025/26 season, according to a new report from Itaú BBA. This massive crop is expected to stabilize global supplies by offsetting lower production in the US, a scenario that will likely keep prices on the Chicago Board of Trade (CBOT) contained. However, despite the record output, Brazilian farmers are facing a significant squeeze on profitability. The primary pressure on farmer margins is an unfavorable exchange rate. A strengthening Brazilian real is pushing down domestic prices at a time when production costs for the current season were locked in when the US dollar was much stronger. This currency dynamic is projected to cause operating margins in key regions like Mato Grosso to fall from 44% in the previous season to 31%. The challenging profit outlook has led to slow forward sales, with only 20% of the new crop sold as of Aug-25, well below the five-year average of 29%. Thus, even though the Brazilian soybean industry benefits from the absence of US sales to China, profits might not necessarily trickle down to the producers level.

Canada

New Canada-Indonesia Trade Agreement to Boost Soybean Sector Access and Stability

Canada and Indonesia have formally signed the Canada-Indonesia Comprehensive Economic Partnership Agreement (CIEPA), a move celebrated by the Canadian soybean industry as a major step forward in securing a key export destination. The agreement is expected to provide enhanced competitive access and long-term stability for Canadian soybean producers and exporters in what is already a substantial and growing market. Indonesia is currently Canada's fifth-largest soybean export market, with annual sales totaling 265,000 mt and valued at USD 143 million (CAD 200 million). According to Soy Canada, which has been a strong advocate for the deal, the formalization of this trade relationship will solidify Canada's position and support continued growth in a dynamic market with rising demand. The agreement is a key part of Canada's broader strategy to diversify its trade relationships away from an over-reliance on the US and deepen its economic ties within the fast-growing Indo-Pacific region. The deal is expected to create a more predictable and competitive environment for the Canadian soy value chain.

United States

China States Resumption of US Soybean Purchases is Conditional on US Tariff Removal

China's commerce ministry has publicly and explicitly stated that any resumption of US soybean purchases is contingent upon the US government removing its tariffs on Chinese goods. In a formal statement, a ministry spokesperson declared that the US must "take positive action to cancel the relevant unreasonable tariffs" in order to create the necessary conditions for bilateral trade to expand. This declaration clarifies the current stalemate that has resulted in China completely shunning US soybeans from the new harvest, placing the responsibility for a resolution squarely on Washington. This direct messaging comes as US farmers are effectively locked out of their most important market during the peak harvest season, with China fulfilling its near-term needs entirely from South American suppliers. While trade negotiations between the two nations are ongoing, the path forward for the soybean sector is, from Beijing's perspective, unambiguous. The potential for China to re-enter the US market and provide crucial demand for the new crop now hinges on the US government's willingness to roll back its tariff policies.

Indiana and Arkansas Secure Multi-Billion Dollar Soybean Export Deals with Taiwan

Agricultural leaders in Indiana have signed significant letters of intent with a Taiwanese trade delegation, securing a multi-billion dollar commitment for soybean purchases over the next four years. The new letters of intent are between the Indiana Corn Marketing Council and the Taiwan Feed Industry Association, and the Indiana Soybean Alliance and the Taiwan Vegetable Oil Manufacturers Association. The agreement outlines Taiwan's intent to purchase between USD 3.44 billion and USD 4.2 billion worth of soybeans from the state. The purchases are scheduled to take place over the period from 2026 to 2029. A week prior, the same Taiwanese agricultural industry groups signed letters of intent to purchase soybeans from Arkansas farmers. These deals provide a crucial boost of confidence and long-term market stability for the US soy industry. It reaffirms Taiwan's role as a reliable and vital trading partner, a relationship that has become increasingly important at a time when access to other major export markets is severely restricted due to ongoing trade disputes. The multi-year commitment underscores the strategic importance of diversifying export destinations and securing long-term agreements to support the US farm economy, which depends on international trade to market its substantial production.

2. Weekly Pricing

Weekly Soybean Pricing Important Exporters (USD/kg)

Yearly Change in Soybean Pricing Important Exporters (W39 2024 to W39 2025)

Brazil

In Brazil, the price of soybeans fell to USD 0.40/kg in W39, marking a significant decline of 4.76% week-on-week (WoW) and year-on-year (YoY), and a 2.44% drop month-on-month (MoM). The sharp price drop across all timeframes is primarily driven by the forecast of another massive, record-breaking harvest for the 2025/26 season, now projected at 175 mmt. Furthermore, trade volumes are down for Brazil for this time of the year compared to the five year average. This enormous future supply combined with lower trading volumes is outweighing positive domestic news, such as planned investments to expand local crushing capacity for biofuels. Furthermore, an unfavorable exchange rate is squeezing farmer profitability and pushing down domestic prices in local currency terms. This combination of a bearish global supply outlook and domestic currency pressure has led to the significant price correction this week.

United States

In the US, the price of soybeans was USD 0.45/kg in W39, showing a slight recovery of 2.27% WoW, but remaining flat MoM and down 8.16% YoY. The minor WoW price recovery can be seen as a technical rebound from oversold conditions, likely supported by positive news of a multi-billion dollar, multi-year soybean sales agreement with Taiwan. This deal signals some success in diversifying export markets. However, this small gain does little to alter the overwhelmingly bearish market sentiment reflected in the flat MoM and sharply lower YoY price. China has now explicitly stated that purchases are conditional on the US removing tariffs, confirming a prolonged political stalemate that will continue to cap any meaningful price rallies.

Argentina

In Argentina, the price of soybeans dropped to USD 0.40/kg in W39, a decrease of 4.76% WoW and 6.98% YoY, and down 2.44% MoM. This price drop is a direct consequence of the market dynamics following the government's temporary suspension of export taxes. The policy triggered a "frenzy" of selling that pushed declared exports to a seven-year high, flooding the market with supply declarations. While this initially caused a spike in local prices as exporters rushed to cover their sales, the market is now correcting downward as the temporary incentive window closes. The sharp increase in available supply from Argentina, combined with Brazil's massive harvest forecast, has added significant bearish pressure to the South American market, leading to this week's price decline.

Uruguay

In Uruguay, the price of soybeans held firm at USD 0.44/kg in W39, stable WoW but maintaining a strong gain of 7.32% MoM and YoY. The WoW price stability indicates that the market has successfully consolidated the strong gains made in the previous week. After surging on the news of increased buyer interest from China, prices have now found a new, higher equilibrium. This stability suggests that the new valuation, which reflects Uruguay's enhanced position as a key alternative supplier in the current geopolitical landscape, is holding firm. The strong MoM and YoY performance is a clear reflection of the market repricing Uruguayan soybeans based on this new and significant demand diversification.

3. Actionable Recommendations

Accelerate Diversification Efforts and Maintain Pressure for a Political Resolution

For US agribusiness and farmer associations, the confirmation from China that trade is conditional on US tariff removal solidifies the reality of a prolonged market lockout. US agribusinesses must accelerate their diversification efforts, following the example of the multi-year deal with Taiwan, by aggressively pursuing smaller and medium-sized markets to offset the massive loss of Chinese demand. Concurrently, farmer associations must continue to apply sustained and coordinated political pressure on the US government, clearly communicating the severe economic damage the ongoing trade dispute is causing. A dual strategy of building new, reliable trade partnerships while consistently advocating for a political resolution is the only viable path forward to ensure the long-term health of the US soybean industry.

Capitalize on South American Price Weakness

For global buyers and importers, the current market dynamics present a clear purchasing opportunity. The significant price drop in both Brazil and Argentina, driven by the forecast of a massive future supply and the conclusion of a temporary sales rush, has created a favorable window for securing South American soybeans. Importers should capitalize on this price weakness to fulfill their near-term needs at a lower cost basis. This is an opportune moment to build inventory and lock in supplies before the market fully prices in the next phase of global demand or any potential weather-related supply risks to the new crop.

Sources: Tridge, WFYI, Reuters, Precision Risk Management, Revista Cultivar, Successful Farming, The Poultry Site