On Friday, the U.S. Department of Agriculture (USDA) announced during White House meetings, the Chinese government committed to buy an additional 10 million metric tons of U.S. soybeans. In a tweet, Agriculture Secretary Sonny Perdue wrote: “Hats off to the President (@POTUS) for bringing China to the table. Strategy is working. Show of good faith by the Chinese. Also indications of more good news to come.”
According to a release from the American Soybean Association (ASA), while this news brings purchase commitments from China to approximately 16.5 million, the total purchases still do not add up to the value to soybean growers of seeing retaliatory trade tariffs rescinded.
ASA President Davie Stephens said, “It is good to see our beans moving to China again. While piecemeal purchases such as this one can be a part of the solution, what our industry needs right now is structural reform that leads to China rescinding its tariff on U.S. beans and fully reopening the market.”
In the release, ASA said the industry’s greatest fear is long-term damage to the relationship it has built and sustained with China. The value of U.S. soybean exports to China has grown 26-fold in 20 years, from $414 million in 1996 to $14 billion in 2017. China imported 31 percent of U.S. production in 2017, equal to 60 percent of total U.S exports and nearly one in every three rows of harvested beans. Over the next 10 years, Chinese demand for soybeans is expected to account for most of the growth in global soybean trade, making it a prime market for the U.S. and other countries.
ASA calls for the Administration to continue its talks with China in an effort to rescind the tariffs as part of the negotiated outcomes.