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, China has agreed to buy 12 million metric tons of the crop by the end of the year. However, it’s a long way from making good on its promise, having bought only just over 

Soybean prices have rallied on China’s pledge, nevertheless, making some wonder if the market’s jubilance is appropriate.

“This is a debate that everyone's having,” Minnesota Soybean Growers Association Secretary Kyle Jore said. “Is the current price appropriate for a 12 million [metric ton purchase], or for what we actually know, which is about a one and a half million [metric ton purchase]?”

Markets are pricing in the expectation that China will buy all the soybeans it says it will, Jore said. But he’s worried that might not happen. 

He notes that China isn’t beholden to buy from the U.S. There’s no written agreement, and the country could just as easily purchase soybeans from South America, which is 

“And that means that if we don't see that additional 10-plus million metric tons go out,” Jore said. We could see a significant fall off in our futures price, which has a lot of people concerned.”

Beyond the beans China promised to buy this year lie the orders it pledged to place for the next three years: at least 25 million metric tons a year.

University of Minnesota Grain Marketing Economist Ed Usset said that would 

be less than China’s historic purchases,

 which have usually hovered around 30 million metric tons a year. 

“So they've agreed to purchase [those] amounts in the next three years that are less than we were selling them a few years ago,” Usset said. “So it's not as good as they've been.”

So, with all these seemingly negative variables, why did the market rally, regardless? North Dakota State University Ag Policy Assistant Professor Matthew Gammans said it’s due to a sense of optimism.

“I'm not certain the degree to which kind of recent trends in soybeans are the result of new information that's being incorporated by the market versus some of these fuzzier, kind of emotional responses,” Gammans said.

It’s been a year full of bad news, Gammans said. So, when any glimmer of hope shines through, markets respond in kind.

“And people are kind of adjusting to some degree their beliefs about what the future holds for Chinese purchases,” said Gammans.

The price for a bushel of soybeans is up by over a dollar since the end of October, which U of M Grain Marketing Economist Usset said is a signal that the market is bullish on China’s word.

“So as time goes on, we'll get information about how much they're buying and for what time period and all that,” Usset said. “All we can do is wait and see if they show up.”

But some farmers simply don’t have the luxury of waiting.

Hardship amid a volatile soybean market 

A few weeks ago, Dave Gerry, a farmer from the town of Euclid, Minn., faced a tough decision. 

Soybean prices had been in the dumps for months, partly because of China’s refusal to buy American soybeans. He worried that if China and the U.S. didn’t come to an agreement soon, soybean prices would fall even further.

“I guess I looked at that time, not knowing if we were going to have a soybean market,” Gerry said. “I decided to sell my beans for less money and move them while there was still a place for them to go.”

But because an agreement was reached and prices surged, he’s grappling with his decision.

“You look at it, and you say, ‘Oh, man, I could have,’” Gerry said. “Well, you could have won, but you could have lost, too.”

For farmers such as Gerry, timing the market is becoming increasingly difficult. Farming always has inherent risks, but lately, Gerry said it’s been feeling especially unpredictable. 

“It's a crap shoot,” Gerry said. “It's a roll of the dice.”

He’s now not only thinking of how to approach the soybean market next year, but he’s also concerned for his fellow producers—those who are still at the craps table, waiting for their turn at the dice.

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Despite underwhelming Chinese purchases of U.S. soybeans, soybean prices are rallying.

Soybean prices rally on China's promise to buy American beans. Some producers worry they won't follow through

A man in a hoodie and baseball cap is seen inside the cab of a semi truck.

Tadeo Ruiz Sandoval | MPR News

Large, metal grain storage bins are lined up against a blue sky.

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Soybean prices rally on China's promise to buy American beans. Some producers worry they won't follow through

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