Agricultural Investments

April 11, 19:52 Source: APK-Inform Views: 79

Desperate for Credit, China Importers Default on Soy Cargoes

Three Chinese companies have defaulted on at least 500,000 tons of U.S. and Brazilian soybean cargoes worth approximately $300 million after being unable to open letters of credit with banks.  There are currently 5-6 Panamax cargoes unable to be unloaded at ports and an additional 5-6 cargoes out to sea without letters of credit obtained.  Facing a cooling economy, and signs that authorities will not step in as readily when loans go bad, Chinese banks are becoming more selective about who they lend to.  China imports 60% of the soybeans traded globally and defaults by Chinese buyers will likely cap a rally on global prices as the world is reliant on China to support price strength.




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