(Mirror Daily, United States) – The American Farm Bureau Federation announced that the United States’ soybean sales to China have slipped this year.
AFBA economist Veronica Nigh doesn’t believe China is interested in a large volume of soybean imports this year.
“Soybean exports to China are down significantly from last year and the volume of outstanding sales is relatively low[..],”
Nigh told CNBC.
The lost sales were mainly due to cancellations, changing in destinations, and purchases from third-parties. The lost sales have grown very quickly since the start of the year. By mid-May, the accumulated lost sales surpassed the losses in the previous marketing year.
Over the weekend, the U.S. Commerce Secretary negotiated with Beijing but reached no specific deal. The negotiations focused on energy products and agriculture exports to China.
Beijing Willing to Normalize Trade
Beijing has told Washington that the latest tariffs on its exports will bear consequences. China is the second largest trade partner of the United States when it comes to agricultural products. Around one-third of U.S. soybean exports reach the Chinese market.
Analysts believe that the uncertainty affecting the market environment is impacting exports. The U.S. may lose one of its most important customers if it continues to blast China with high tariffs.
Beijing said last week that the volume of U.S. imports would go back to normal if the Trump administration renounced the new tariffs. China also wants to buy around $70 billion in energy products and agricultural products, on those conditions.
The United States’ trade deficit has ballooned to $375.2 billion. The Trump administration is desperately trying to reduce the gap. But the trade dispute is not only about reducing the trade deficit. Washington wants to protect the nation’s intellectual property as well.
Soybean exports slumped this year for another reason. The protein content of the U.S. products has hit a historical low.
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