{"id":5453,"date":"2018-12-14T05:33:50","date_gmt":"2018-12-14T05:33:50","guid":{"rendered":"http:\/\/www.styledeals.co.uk\/blog\/china-buys-us-soybeans-for-first-time-since-trade-war\/"},"modified":"2018-12-14T05:33:50","modified_gmt":"2018-12-14T05:33:50","slug":"china-buys-us-soybeans-for-first-time-since-trade-war","status":"publish","type":"post","link":"https:\/\/www.styledeals.co.uk\/blog\/china-buys-us-soybeans-for-first-time-since-trade-war\/","title":{"rendered":"China buys US soybeans for first time since trade war"},"content":{"rendered":"\n
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\"SoybeansImage copyright<\/span>
\n Reuters<\/span><\/p>\n

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Image caption<\/span>
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\n China’s purchase of 1.13 million tonnes of US soybeans has been hailed as a wonderful, great step by US officials.
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China has bought US soybeans for the first time since the trade war between the two countries started in July – a move hailed as a “great step” by US officials. <\/p>\n

One of the biggest casualties of the US-China trade war has been the US soybean sector. <\/p>\n

China is by far the world’s biggest importer of soybeans.<\/p>\n

And Beijing’s high tariffs placed on US soybeans this year has been severely hurting US farmers.<\/p>\n

A trade truce between China and the US was reached earlier this month however, and there had been much anticipation that China would soon return to the US soybean market.<\/p>\n

But while China’s purchase of 1.13 million tonnes of US soybeans on Thursday was meet with much applause from some, others said the purchase was too small, and not a sign that the trade war was cooling. <\/p>\n

“Having a million, million-and-a-half tonnes is great, it’s wonderful, it’s a great step,” said Steve Censky deputy secretary of the US Department of Agriculture.<\/p>\n

“But there needs to be a lot more as well, especially if you consider it in a normal, typical year, we’ll be selling 30 to 35 million metric tonnes to China.”<\/p>\n

The sale also failed to excite traders, who said the numbers fell short of estimates, which saw a sell-off in soybean futures. <\/p>\n

“It’s a start, but it’s not nearly enough to fix our problems in regards to soybeans and a soybean oversupply in this country,” said Joe Vaclavik, president of Standard Grain, a Tennessee-based brokerage.<\/p>\n

Why do soybeans matter? <\/h2>\n

In 2017, soybeans were the single biggest US agricultural export to China<\/a>, which accounts for some 60% of the global trade in the commodity. <\/p>\n

And soybeans are vitally important to China because they use the product to feed livestock.<\/p>\n

The key supplier globally is Brazil, but China has also relied heavily on the US for soybeans supplies – in part due to seasonality. <\/p>\n

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Chief economist Robert Carnell from ING Bank told the BBC that China’s purchase on Thursday was more about convenience than anything else.<\/p>\n

“The simple fact is China needs a lot of soybeans and it’s been buying them from Brazil, not the US,” he said. <\/p>\n

“But Brazil could never supply all the soybeans China needed, so ultimately [China has] been driven back to US soybeans. And I think it’s just convenient for them to do that right now.”<\/p>\n

Mr Carnell said that the recent arrest of Meng Wanzhou, Huawei’s chief financial officer and deputy chair,<\/a> was far more indicative of where the trade war between the US and China was really up to. <\/p>\n