U.S. grain futures fall as China begins limited purchases of U.S. farm goods

U.S. grain futures fell sharply Thursday as China begins modest purchases of U.S. farm products following last week's meeting between President Trump and China's President Xi, but traders still await significant soybean purchases after the Trump administration said China pledged to buy 12 million tons by year-end and and at least 25 million tons in each of the next three years.

Chinese buyers have booked two cargoes of U.S. wheat totaling 120,000 metric tons, the first such purchases since October last year, Reuters reported Thursday, while a sorghum shipment has been sent from the U.S. to China, a U.S. industry official said.

Analysts say China's decision to leave intact a tariff of 13% on soybeans makes U.S. shipments too expensive for commercial buyers compared to Brazilian cargoes.

"China purchases have been slow to materialize, and China has yet to confirm they will make large purchases before the end of the year," Doug Bergman of RCM Alternatives said in a note.

Uncertainty caused traders to take profits amid questions of whether Trump's tariffs will stand scrutiny from the Supreme Court, Karl Setzer of Consus Ag Consulting wrote, adding that without the threat of tariffs, China seems unlikely to return to regular purchasing of U.S. soybeans.

CBOT wheat for December delivery (W_1:COM) closed -3.4% to $5.36 per bushel, soybeans for January delivery (S_1:COM) ended -2.3% to $11.08 per bushel, and corn for December delivery (C_1:COM) settled -1.5% to $4.28 3/4 per bushel.