Canadian Soy Growers Could Win From Cancelled China Contracts

Canada might soon be reaping the benefits from the recent string of canceled soybean contracts, Simon Wilson, executive director of the North Dakota Trade Office, told CNBC.

“The big competitor for us is Canada,” Wilson told CNBC’s Contessa Brewer on Friday’s “Power Lunch.” “They have similar weather, similar production cycle. And for us, we’ve always been competing with them.

usdcad Canadian dollar graph, July 23, 2018

But now, after Chinese buyers canceled all of their firm orders for food-grade soybeans earlier this month, the competition might heat up. The scrapped contracts amount to a loss of $1.2 million to $1.5 million, but that’s a small portion of North Dakota’s $30 million to $35 million in annual contracts, which are usually finalized in the summer months.

Wilson said Chinese trade delegations, previously scheduled for September, have gone “radio silent on us.”

“There’s a lot of money in this,” he said. “It’s a big market. China’s a massive market for soybeans.”

via CNBC

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza