Two Soybean Prices, One Market

By: Spencer Graham

Apr. 26, 2026

The CBOT May 2026 soybean futures closed at $11.71/ bushel on March 31. That number is everywhere right now. It's also a largely useless signal of what soybeans are worth in this market. A Chinese buyer purchasing soybeans in Shanghai doesn't care about Chicago. He cares about FOB Santos, which was running about $40/mt cheaper than equivalent U.S. Gulf prices in February 2026 ($40/mt translates to roughly $1.09/bushel). This gap represents pure trade policy. And it's the only price that tells you what's really going on.

The CBOT and FOB Santos have diverged into two separate regional price signals. The CBOT reflects U.S. domestic demand, while the FOB Santos reflects global demand, including that from China. But the gap between them still remains. These contracts used to move together, but now they don’t. Physical traders who recognize this spread have an advantage.

China imported a record 111.82 million metric tons of soybeans in 2025, representing a 6.5% increase from the previous year. Brazil supplied 73.6% of it in 2025 and was 71% in 2024. Also, U.S. shipments fell 24.1% to 16.8 million metric tons. China limited buying American soybeans between June and late October.

The tariff differential explains this imbalance. China charges 13% on U.S. soybeans and only 3% on Brazilian beans. Because the FOB Santos is running $40/mt cheaper, private Chinese buyers aren't paying that premium for the U.S.-based soybeans. The only U.S. buyers left in China are state-owned COFCO and Sinograin, which don't face the same commercial pressure as private companies.

Brazil's supply position makes it harder for the U.S. to compete even at lower prices. Conab projects Brazil's 2025/26 crop at a record 178 million metric tons, with exports at 112.2 million metric tons. This production is almost equal to the total U.S. soybean production of 115.75 million metric tons. Brazil isn't just filling the gap China left. It's replacing the U.S. as China's primary supplier structurally.

November 10, 2026, is when the current tariff truce expires. It froze further escalation but left the 13% tariff intact. No extension means the basis widens. A tariff cut means it narrows. The market is pricing one of those two outcomes right now.

What is the basis, and why is it the signal?

The basis is the spread between a local cash or FOB export price and the nearby CBOT futures contract. Physical traders watch it because it tells them whether grain is moving, where it's moving, and at what margin. A futures price alone doesn't answer those questions.

This is where the South American Soybean futures contract (SAS) comes in. This futures contract settles against the FOB Santos price and can be spread directly against the CBOT. The SAS contract allows market participants to manage regional price risk in both South America and North America. CBOT is a paper market quoted in bushels; physical trade happens in metric tons. The SAS contract sits at that intersection.

In 2025, the Chicago-Brazil spread moved over $80/mt in a single year. Mid-year, SAS was trading more than $80/mt below CBOT as the Brazilian harvest flooded the market. By the end of the year, it the price of SAS had flipped above CBOT. This was a result of seasonal flows turning towards America soybeans, but Chinese investors weren’t willing to invest heavily in the US. This caused investors to still compete for end-of-season soybeans from Brazil, causing the price of the SAS to overtake the CBOT. An $80/mt swing in one contract year is not a seasonal variation. It's a market being repriced by trade policy.​

Seasonality adds another layer. The U.S. historically dominates export flows from December through March. Brazil takes April through November. That's already a narrow window for U.S. competitiveness, and the 13% tariff has compressed it further. Even during peak U.S. export season, Brazilian beans are cheaper in China. The U.S. isn't just losing market share in the offseason anymore.

Firm/market implications

Cargill, Louis Dreyfus, Viterra, and Bunge all have grain handling infrastructure in both the U.S. and Brazil. When the Santos basis is weak, they route demand toward U.S. origin. When the tariff gap holds, and Brazil is cheaper, they push Brazilian throughput. The ability to switch origin on a cargo-by-cargo basis is worth a lot in a segmented market. A fund running a CBOT futures position can't do that.

The USDA Prospective Plantings report on March 31 showed farmers intend to plant 84.7 million soybean acres in 2026, up 4% from last year's six-year low. Corn fell 3% to 95.3 million acres. But what's driving this increase?

USDA raised its 2025/26 domestic crush forecast to a record 2.61 billion bushels and cut its export forecast by almost the same amount. Farmers are planting more beans because domestic crushers are buying them, not the Chinese. Those are two very different demand signals, and CBOT is only reflecting one of them.

The Santos price is now doing the job CBOT used to do. It's where the world's largest buyer is actually clearing. CBOT has become a domestic U.S. price with a global label still attached to it. That gap between what the contract says it represents and what it actually reflects is where the mispricing lives.

November 10 is the date everything hinges on. If the agreement between the United States and China expires without extension, private Chinese crushers will continue to buy more from Brazil. Meaning that the spread between long Santos contracts and short CBOT will widen. But if the tariffs get cut and Chinese buyers come back to U.S. origin, the spread between long CBOT and short Santos will close the gap. Right now, the basis is pricing the first outcome. That could change fast if diplomatic signals shift between now and November.

The spread between the FOB Santos and the CBOT has compressed since February. It went from $40/mt to around $15/mt. This can be due to seasonal dynamics of Brazil’s harvest or optimism heading into the negations in November.

But this gap exists. Brazilian beans are still cheaper landed than US beans. The $15/mt spread doesn’t seem like much, but on a 60,000 metric ton cargo, it's $900,000 per shipment. The gap has narrowed but hasn’t closed.

The soybean market has split into two. CBOT prices U.S. domestic demand, and Santos prices the world. That split exists entirely because of a 10% retaliatory tariff. If November 10 passes without a deal, the spread widens. If tariffs get cut, the CBOT closes the gap and the two markets reconnect. November 10 doesn't just determine where soybean prices go. It determines which contract is a better reflection of the global market.