China has committed to purchasing 12 million metric tons of U.S. soybeans by the end of the year, providing a potential boost for producers in the Midwest.
Nate Franzen, President of Ag Banking at First Dakota National Bank, said the anticipated purchase would be particularly beneficial for farmers in South Dakota and surrounding states. “If you look at our transportation system, especially here in South Dakota and the Midwest, a large portion of our soybeans travel by rail westward to be shipped to China. This makes producers in the Dakotas especially sensitive to changes in international demand,” Franzen explained.
China is typically the largest buyer of U.S. soybeans, but it has largely remained absent from the market this year. The renewed purchase commitment is expected to positively impact local producers and the regional agricultural economy.