China Stopping All U.S. Agriculture Imports
- On Sunday, 8/4/2019, the Chinese government asked both state-owned enterprises, COFCO and Sinograin, to suspend the purchase of all U.S. agricultural goods.
- Private soybean crushers and other non-state owned entities remain exempt from the import ban.
- The directive from Beijing follows President Trump’s decision last week to increase the import tariff on $300 billion worth of Chinese goods effective September 1.
- A major driver of President Trump’s decision to unexpectedly and hastily raise tariffs is a result of China’s purchasing U.S. farm goods at too slow of a pace.
- The primary target seems to be U.S. soybeans, but pork and other commodities are included.
- What It Means For The U.S. Farmer: At FBN, we believe that this decision is a negative for the U.S. farmer. China’s decision to retaliate and once again target U.S. agricultural producers does not come as a total surprise to FBN. Because China does not purchase U.S. corn; and imports wheat and pork in limited quantities, the U.S. soy producer should feel the brunt of this latest action.
EU Agrees To Increase U.S. Beef Imports
- U.S. President Donald Trump announced on Friday an agreement to open up European markets to more U.S. beef exports.
- EU sources and diplomats said a deal had been reached to allow the United States a guaranteed share of a 45,000 tonne European Union quota for hormone-free beef.
- U.S. and European officials have been working to lay the framework for talks on a trade agreement but agriculture remains a sticking point for both countries.
- The deal would not change the overall import volume and would also still need to be approved by the European parliament.
- What It Means For The US Farmer: At FBN we believe this recent development is a positive for the U.S. cattle producer. The deal does not include any modifications to the EU’s refusal to import non-hormone free beef from the U.S.
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