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Beijing says China stepping up US soy imports, yet to show up in US data

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Chinese state media said on Sunday the United States has shipped several million tonnes of soybeans to China since the two countries’ leaders met in June, although US government data shows that the volume was much less.

 

The US-China trade war has curbed the export of US crops to China, with soybean sales falling sharply after Beijing slapped tariffs of 25% on American cargoes.

 

US Department of Agriculture (USDA) data shows that just 1.02m tonnes of soybeans were shipped to China for the period starting from the G20 meeting June 28 to the week ended July 18, the most recent date for which data is available. These shipments reflect purchases made earlier this year, and the USDA is expected to release new data this week.

 

But state broadcaster CCTV, citing China’s National Development and Reform Commission and Ministry of Commerce, said China has made enquiries to US suppliers for the purchase of soybeans, cotton, pork, sorghum and other agricultural products since July 19 - and some sales have been made.

 

"As long as the American agricultural products are reasonably priced and of good quality, it is expected that there will be new purchases," the report said. Companies involved in the sales have applied for exclusions to tariffs on agricultural goods with Chinese customs officials, it said.

 

Wuhan-based Jim Huang, chief executive of China-data.com.cn, an independent agriculture consultancy, said on Monday that buying will be carried out by "state firms and other major players, based on the prices and their actual demand. So the process won’t be that quick."

 

"China is sincere in negotiating with the US and is offering goodwill gestures," said Huang.

 

 

SHANGHAI SHOWDOWN

 

CCTV said the moves show China’s willingness to promote US products and make good on a consensus reached between presidents Donald Trump and Xi Jinping at the G20 summit in Osaka in June.

 

Chinese and US negotiators are set to meet in Shanghai this week for the first time since the summit, with talks to start on July 30.

 

Earlier this month, the Trump administration said it would exempt a relatively narrow list of 110 Chinese products from tariffs, including medical equipment and key capacitors.

 

The state media report on Sunday said the United States should "take concrete measures to implement its relevant commitments and create favorable conditions for bilateral economic and trade cooperation."

 

Meanwhile customs data released on Saturday showed China brought in 614,805 tonnes of soybeans from the United States in June, down 2.5% from June 2018 and down 37% from 977,024 tonnes in May.

 

According to Refinitiv ship tracking data, about 30 shipments carrying a total of 1.02m tonnes of soybeans left the US for China in May, compared to 8 shipments containing a total of 198,641 tonnes of soybeans that departed the US for China in June.

 

 

NO RUSH FOR CRUSHERS

 

Five Chinese soybean crushers are eligible for exemptions from 25% tariffs on some US cargoes, the state planner told them, but they are unlikely to be in a rush to buy in bulk as the industry grapples with poor crushing margins and a premium on US soybean versus Brazilian soybeans. China’s demand for soybeans crushed into livestock feed has also decreased dramatically in recent months as African Swine Fever swept across the country, resulting in the death or culling ofms of pigs.

 

Each of the five crushers, who were asked to take part in the new plan, was given a separate quota, with the total volume of this batch of extra tariff-free imports estimated at around 2-3m tonnes, according to one person with knowledge of the plan.

 

Last week, US agriculture Secretary Sonny Perdue said China had commitments to buy 20m tonnes of soybeans but he did not specify a time frame.

 

For the whole of 2018, China imported 16.6m tonnes of soybeans from the United States - about half of 2017’s 32.9m tonnes - as the tariffs on American cargoes cut into buying.

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