China is the world’s largest buyer of soybeans, and for years Brazil took an increasingly larger share of that trade away from the US.
Chinese buyers are snapping up Brazilian soybeans for delivery in October, the time of year when US exports are usually at their peak, according to people familiar with the deals.
More deals are still likely for the fourth quarter, according to people who asked not to be identified because the deals are private.
The sales come as Brazil reaps a record crop and offers prices much lower than rival producers.
It also underlines President Luiz Inacio Lula da Silva’s aim to strengthen connections with China as part of Latin America’s largest economy’s growth strategy.
As Brazilian production expands, American farmers are losing their competitive advantage in global agricultural markets.
Geopolitical tensions have also prompted China to seek deeper ties with the South American country and reduce its historical dependence on the United States.
Lula’s plan to deepen relations with China includes obtaining more financing from the Asian country and reducing the role of the dollar in foreign trade transactions.
A trip to China by a Brazilian delegation earlier this year resulted in more than 15 agreements worth over $10 billion in Chinese investment pledges.
