China May Pay More for Soy Amid Trade Spat

June 14, 2018 02:26 PM
China’s threats of tariffs against imports of U.S. soybeans may end up being a costly move for the Asian country if the trade spat heats up.

(Bloomberg) -- China’s threats of tariffs against imports of U.S. soybeans may end up being a costly move for the Asian country if the trade spat heats up.

That’s according to a report Thursday from Sam Funk, an analyst at Rabobank, who said that duties against U.S. shipments may mean that China ends up buying supplies from South America at a premium. Brazil is the world’s biggest soy exporter, followed by the U.S.

Soybeans are among products caught in the tit-for-tat trade tiff between the U.S. and China, the biggest consumer of the crop. The Trump administration plans to announce a final list of tariff targets on Friday for Chinese products. Soybean growers, traders, handlers and investors are waiting to see whether China subsequently follows through on plans for retaliatory duties on U.S. shipments of the oilseed.

Trump Says He May Upset China on Trade as U.S. Tariffs Loom

Prices for South American supplies are already on the rise thanks to increased Chinese buying, a drought in Argentina and a recent truckers’ strike in Brazil.

“If trade negotiations and potential policies continue to distort Chinese imports of U.S. soybeans, other countries will benefit from lower U.S. soybean prices,” Funk said. “China will also have to pay continued premiums for South American soybeans.”

Dependence on South American supplies may also limit China’s ability to buy throughout the year, Funk said. Soybean importers often turn to the U.S. for shipments after the Northern Hemisphere harvest around September and then gradually shift purchases to South America around February.


Copyright 2018, Bloomberg

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Spell Check

northeast ne, NE
6/14/2018 03:16 PM

  Thank goodness these trade wars are "actually very easy to win". I'm thinking there could be a lot of other casualties besides the poor Chinese bean buyers, for example thousands of American farmers

Larry K
Chicago, IL
6/16/2018 03:44 PM

  China can not put heavy tariffs on United States soy beans. It will cause too much turmoil and damage to their populace. The Chicken Little farmers here can stop aimlessly running around screaming THE SKY IS FALLING! THE SKY IS FALLING! If china does, all the United States has to do is sell their soy beans to another country that can turn around and sell them to China at an inflated price!! Maybe some Chinese might be willing to go on a diet, but I seriously don't think their poultry and livestock will. And if china wants to put a heavier tax on pork, how much will the biggest producer of pork in the United States, Smithfield, be taxed by China? Smithfield is owned by China! If china excludes Smithfield from that tax the hog farmers in the United States can sell their hogs to Smithfield. Then President Trump can levi an export tax on pork going to china, if he so desires! China and the PU of Europe will negotiate with the United States and Presdent Trump on our trade deals leaving the United States with one fair to the United States. That includes Trudy from Canada. It amazes me how so many so called Americans keep on crying about how Presdent Trump is not following the status quo of previous politicians dealing with foreign nations and international situations? That is why I voted for him. Their status quo didn't work! GOD BLESS THE UNITED STATES!!! GOD BLESS PRESIDENT TRUMP!!! And hey Bill. Why don't you just plant three of those soybeans and climb the bean stalk up into the clouds somewhere!!!


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