Trade war reshapes grain market

The trade war between the United States and China has once again become the focus of global agribusiness. In April 2025, bilateral tariffs reached their highest levels in history: 125% imposed by China on the United States and 145% by the United States on China, virtually interrupting all trade flows between the world's two largest economies. The clash, which involves accusations of currency manipulation, non-tariff barriers and disputes over geopolitical dominance, has direct repercussions on global grain pricing — and Brazil is emerging as a strategic and urgent alternative for Chinese buyers.

In practice, the dispute boosted the appreciation of export premiums in Brazil, increased demand for Brazilian soybeans and reignited the debate on logistics capacity and risk management. Although the situation appears to favor Brazilian producers, the scenario remains extremely volatile and requires well-founded decisions.

“Brazil was called upon to play a central role. China not only retaliated against US tariffs, but also intensified purchases from Brazil, notably the acquisition of at least 40 ships of soybeans between May and July,” explains Felipe Jordy, intelligence and strategy manager at Biond Agro.

Brazilian soybeans in focus, but with limits

With soybean stocks and coverage at 5-year lows, the redirection of purchases has favored Brazil — but not without risks. Part of the short-term demand has already been absorbed, which means that Chinese purchasing power may diminish in the coming months, especially if there is a decline in geopolitical tension or a repositioning of global supply. With these new purchases, the Asian giant is already committed to at least 70% of a program for the 24/25 harvest of 110 million tons.

“This is a window that could close quickly. Shipments from April to June were already partially compromised, and now with this new round of purchases, China’s coverage extends even further,” he warns.

In addition, there is pressure on the outflow infrastructure and a mismatch between the appreciation of premiums and the performance of the Chicago Stock Exchange (CBOT), which remains under pressure due to the possibility of an increase in the area planted in the USA and high stocks, especially of soybeans.

Risk management at the forefront

The current scenario is guided by flow expectations, not by consolidated volume. Premiums at Brazilian ports have peaked above US$1,00 per bushel, but are subject to rapid reversals if the US-China conflict stabilizes.

“This gap between premiums and the stock market is typical of a speculative moment and was quickly corrected with a volume taken from China and ample supply in Brazil. The opportunity exists, but it is sensitive to the news and diplomacy,” he reinforces.

For producers, the current situation demands commercial discipline. Strategies with defined goals, margin protection and contracts aligned with logistical reality become important differentiators to sustain profitability amid instability.

“The year 2025 has already brought additional challenges, with irregular weather, high logistics costs and now the trade war. Volatility is part of the game, but management predictability is what turns a good year into an excellent result”, concludes Jordy.