Archer Daniels Midland (NYSE:ADM), Bunge Ltd (NYSE:BG), Cargill Land Deal with Chinese Importers

With the backdrop of a huge and surprising deal by China to acquire soybeans from American farmers, valued at $6.7 billion, companies like Archer Daniels Midland (NYSE:ADM), Bunge Ltd (NYSE:BG) and Cargill signed deals with major Chinese importers, including COFCO and Sinograin.

The deal for soybeans by China was the largest it has ever entered in as a one-off deal.

Dealers responded saying they thought there would be a symbolic purchase of soybeans, but not a legitimate, major deal like the one entered into.

It is believed the Chinese made it over concerns soybean prices could rise significantly throughout 2011, so they locked in prices now.

The overall deal represents 11.5 million tons of soybeans to be delivered in 2011 incrementally. The overall total is enough to meet the import demand of the Chinese for up to three months.

Soybeans acquired by China will be for delivery in the 2011/12 (September-to-August) marketing year.

Prices for soybeans have reached a 30-month high in January on Chinese demand and production concerns in South America.