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Reports indicate China is buying U.S. soybeans

The commodity markets were abuzz today with reports China has resumed purchases of U.S. soybeans.

Rich Feltes is head of market insights for Chicago-based brokerage R.J. O’Brien.

“As purchases go, this is really sizeable. Reportedly it’s going to be as many as 30 cargoes—which would be one-and-a-half million tons—and some think it may be over two-and-a-half million tons,” Feltes says.

He says official confirmation of those purchases will not come until tomorrow morning. He says the big question is whether the buying will continue.

“For the rest of the week and the rest of the month, the degree to which Cofco and Sinograin—those are the two Chinese government agencies that can buy without the tariff—the extent to which there are follow-up purchases. That’s going to be very key.”

Feltes says it’s been rumored the Chinese would buy five to eight million tons from the U.S.

AUDIO: Rich Feltes