WASHINGTON — Following the recent economic trade meeting between President Donald Trump and Chinese President Xi Jinping, trade relations were negotiated to include the opening of markets for U.S. soybeans, poultry and other agricultural exports.
Through these new trade accords, China will be suspending all retaliatory tariffs announced since early March, a fact sheet from the White House announces. Among the products included in these tariffs are U.S. chicken, soybeans, corn, pork, beef, aquatic and dairy products, vegetables, fruits, cotton, and sorghum.
Regarding soybeans, specifically, it was also reported that China is to purchase at least 12 million metric tons of U.S. soybeans for the remainder of this year, and purchase at least 25 million metric tons of U.S. soybeans a year through 2028.
The American Soybean Association “is encouraged that these commitments are framed as minimums and looks forward to continued growth in soybean purchases beyond these levels,” the association noted in a release. “China has historically purchased 25 to 30 million metric tons of U.S. soybeans in recent years, and (these newly announced) commitments lay a strong foundation to return to those traditional volumes over the coming marketing years.”
This recent trade announcement “is great news for American agriculture and soybean farmers are extremely grateful to President Trump for making soybeans a priority in negotiations with China,” ASA President Caleb Ragland, who is also a soybean farmer from Magnolia, Ky., added. “This is a meaningful step forward to reestablishing a stable, long-term trading relationship that delivers results for farm families and future generations.”
The ASA also noted that it, “looks forward to continuing to work with the administration to ensure that today’s positive developments lead to lasting market stability and stronger opportunities for U.S. soybean farmers.”
Regarding U.S. soybean trade with China, “Historically, over the last decade U.S. farmers have exported an average of more than 27 MMT of soybeans each calendar year. While the commitment to purchase 25 MMT falls slightly short of the historical average, it’s important to acknowledge that these commitments are a minimum, and not a maximum purchase amount,” Dr. John Newton, the American Farm Bureau Federation’s vice president of public policy and economic analysis, recently noted in a report. “Exports at or above these agreed-upon quantities would represent a minimum of approximately $32 billion received by farmers based on today’s marketing year average price projection of $10 per bushel (this total would move higher as export volumes or soybean prices move higher).”
Will, however, this new trade agreement provide relief to U.S. soybean growers in need?
“While not a cure-all, especially with other priorities like year-round E-15 and fair and enforceable trade agreements in other parts of the world, China remains the 800-pound gorilla in the room that many hope will begin to turn around farm income and generate economic activity in the communities farmers and ranchers call home,” Newton added. “Whether that hope becomes reality will depend on consistent follow-through by both parties and a geopolitical and market environment that allows the deal to endure.”
