Tariff Loophole: How U.S. Soybeans Might Be Getting To China

September 27, 2018 12:24 PM
 
 

Chinese soybean buyers could be circumventing soybean tariffs by purchasing them through Argentina. According to export reports, Argentina is buying U.S. soybeans for their domestic market and then exporting their own soybeans to China. An unlikely scenario according to one market analyst, who cites drought leaving Argentina’s grain stocks in short supply.

“The issue here is that Argentina doesn't have the beans,” says Joe Vaclavik of Standard Grain.  “They had a short crop this year.”

In addition, Vaclavik says Argentina usually crushes the majority of their soybeans and they typically don’t export soybeans this time of year.

“It looks as if they're going to get the soybeans from the United States,” he explains. “They've booked 850,000 metric tons of beans since September 1.”

According to Vaclavik, Argentina didn't sell any soybeans to China from September to February last year. However, this year, the South American country plans to ship 1.8 million metric tons during that same period. Even if the U.S. beans are not sold directly to China, the export market is still helping prices, he says.  

Farmers have long suspected China purchasing soybeans through “grey” market channels.

“Nobody expected that China would ever go this long and not have to buy some soybeans,” says Garry Niemeyer, an Illinois farmer and former president of the National Corn Growers Association. “Maybe they are getting U.S. soybeans through the back door from other countries. That’s as aggravating as not getting a legitimate tariff deal done.”

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Comments

 
Spell Check

childsplay
oconto falls, WI
9/28/2018 06:42 AM
 

  To paraphrase Gomer Pyle: Surprise, surprise, surprise! I remember when another tough as nails President named Jimmy Carter enacted an embargo on the USSR in 1980 and stopped shipments of food to them. The butter seemed to pile up until New Zealand stepped in and bought it up. Question: what did they do with it? Answer: They sold it to some unknown buyer with the initials of USSR. So much for Jimmy and his principles. Now we have Donny grinding his axe and somehow we farm folk are left bearing the brunt of it.

 
 
Wisconsin Corn Grower
Kewaunee, WI
9/28/2018 08:11 AM
 

  The best part is they are buying them at $7 per bushel from us and probably selling them for $10 per bushel to China money that could be put in the American farmers pocket instead of their pocket. As usual the middle man makes the profit instead of the farmer. Add to that the payments that USDA is making to farmers to offset the loss of this income and the fact that as a tax payer a portion of my taxes have go to pay for that program what a win win situation that is. Thanks Mr. Trump.

 
 
Concerned farmer
Wing, IL
9/28/2018 03:51 PM
 

  Typical ignorant farmer. CONTROL your production dips**t. By the way send me all your government checks!

 
 

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