China, the world’s largest soybean buyer, has put purchases of American supplies on hold after the trade war between Washington and Beijing escalated, according to people familiar with the matter.
State-grain buyers haven’t received any further orders to continue with the so-called goodwill buying and don’t expect that to happen given the lack of agreement in trade negotiations, said the people, who asked not to be named because the information is private. Still, China currently has no plans to cancel previous purchases of American soybeans, the people said.
President Donald Trump escalated his trade war with China earlier this month, ramping up tariffs on about $200 billion of Chinese goods, prompting Beijing to retaliate with further duties of its own. Trump and his counterpart Xi Jinping are expected to meet again at the end of June for the G-20 summit, when some analysts predict a potential resolution.
Soybean futures in Chicago slumped to a 10-year low earlier this month as the tensions peaked. Since then, prices have rebounded as a deluge of rain roils U.S. plantings.
13 Million Tons
Government data indicates China bought about 13 million metric tons of American soybeans after the countries agreed to a truce in December, in a move that showed goodwill toward getting the trade dispute resolved. While U.S. Agriculture Secretary Sonny Perdue said in February that China had pledged to buy an additional 10 million tons of American soy, purchases have now stopped.
USDA data also showed that China is yet to take delivery of about 7 million tons of U.S. soybeans that it has committed to buy in the current marketing year.
Spokesmen for state-run buyers Cofco and Sinograin had no immediate comment.
Clamping down on U.S. soybean purchases is a direct strike at Trump’s political base. In the the 2016 election, Trump carried eight of the 10 states with the largest soybean production, all of them in the Midwest. Iowa, the country’s second-largest soybean producer after Illinois, swung from Democrat to Republican in 2016 and could swing back again in 2020.
Falling Incomes
The trade war with China is compounding the strain of five years of falling commodity prices and losses from spring flooding across the Midwest. Overall, U.S. farm income dropped 16% last year to $63 billion, about half the level it was as recently as 2013.
The president moved to shore up support in rural America immediately as he escalated the trade dispute earlier this month, announcing on the same day a new round of trade aid for farmers. The U.S. Agriculture Department said the aid package would total $16 billion.
There are signs China is replacing U.S. soybeans with Brazilian supplies. The premium paid for soybeans loading at Paranagua port more than doubled over the past month as the pace of exports has accelerated in the past weeks.
“Brazil will supply China almost exclusively from now on,” said Pedro Dejneka, a partner at Chicago-based MD Commodities.
China is also grappling to contain a deadly swine disease outbreak in its hog herd, curbing demand for livestock feed. Soybeans are a key component of the rations, and Rabobank estimates about 30% of the nation’s pork supply has been lost.
“There are signs China is replacing U.S. soybeans with Brazilian supplies.”
Better quality, most likely.
If I’m not mistaken, I believe much of the soybean grown here is GMO now.
In 2018, 94 percent of the soybean crops in the United States were genetically modified to be herbicide tolerant. Genetically modified crops have taken agriculture in the U.S. by storm. By comparison, only 17 percent of soybean crops were genetically modified in 1997. Other crops grown in the United States which are mostly genetically modified are cotton and corn. https://www.statista.com/statistics/217108/level-of-genetically-modified-crops-in-the-us/
It don’t matter the farmer are having a rough time getting the crops into the ground all over the USA . Ever we’re you look there flooding . Last two days we had over 2 inches plus here again . Most can’t even get there hay cut and rolled if this keeps up they may lose there first cutting of hay . You keep hearing food prices are going up , again watch Wall Street there beating on this
Yup
Farmers haven’t even gotten anywhere near the fields up here
It’s been 28 days out of 30 with rain in them
We don’t have farm fields anymore here , they are shallow lakes and it’s soon to be June
Almost an entire month lost getting things in the ground
And I do believe our soy beans are GMO
And in the long run , that is going to hurt our markets more than help IMO
By design no doubt, weather manipulation. Right infront of our goddamn eyes brothers and sisters.
We have been weather manipulated…
The billionaires don’t give a damn, but the little guy is screwed.
What good is a revolution if you cant eat? Think about that for a moment. You can’t even feed the goddamn farm animals if you cant grow hay or corn..
These fkrs have this shit planned to the tee brother.
Still lots of grass in the fields though….but who owns the fields? We sure as hell dont..better start thinking this shit through man..
China is months to years from total default. They are in debt many times worse than we are. They have a lot of people and no money. They need a war. And better management. China spends money ten times as fast as us corps and on lower returns.
@ Misty@ 8:22 (can’t do direct replies on this search engine).
Suspected as much.
Found this as well. “Roughly half of the global area of GMO crops is soybeans, according to the ISAAA. 47 percent of the global area was for herbicide-tolerant GMO crops. The US planted the most GMO crop area at 73 million hectares, followed by Brazil (49 million), Argentina (24 million), Canada (12 million) and India (11 million). These 5 countries made of 91 percent of the global area of GMO crops.”
So they’re not much better off with Brazil after all.
The corn I knew about (quit eating it years ago), and the cotton, as well… farmers in India have been committing suicide over that cr@p for a few years now.