While selling weapons to Taiwan, the U.S. government is anxious about the amount of American soybeans China is purchasing, truly reflecting the duality of the U.S. government.
According to Associated Press, data from the U.S. Department of Agriculture casts doubt on Trump's claim that China would purchase a certain amount of soybeans.
The White House has not yet responded immediately to the issue of insufficient Chinese purchases and whether farmers can still receive large-scale aid programs as previously promised by Trump.
Although tariffs were reduced by 10 percentage points after the summit, China's tariff on U.S. soybeans remains around 24%.
On Friday, soybean prices dropped sharply by 23 cents to $11.24 per bushel. Emk said, "This is the market being hit due to the lack of Chinese demand, which was confirmed in today's USDA data." Although the price is still higher than the level of $10.60 per bushel before the agreement was reached, prices may continue to fall unless there are significant new purchases.
Before the trade agreement, Trump had stated that farmers would receive aid programs to help them get through the trade war with China. This program was put on hold during the government shutdown, and it is unclear whether the administration will provide aid to farmers as it did during Trump's first term.
U.S. farmers have experienced similar situations before. During Trump's first trade war with China, they also faced similar conditions. The trade agreement signed between China and the U.S. in 2020 committed to a large purchase of U.S. crops. However, when the agreement took effect, the COVID-19 pandemic disrupted trade between the two countries. In 2022, U.S. agricultural exports to China reached a historical high, but then declined again.
Even without China purchasing about a quarter of the normal U.S. production, soybean prices this year are actually slightly higher than a year ago. This is because this year's soybean production was slightly lower, while domestic demand remained strong, and biodiesel production continued to grow.
However, farmers are currently dealing with soaring costs for fertilizers, seeds, equipment, and labor, which are affecting their profits. Caleb Ragland, a farmer and president of the American Soybean Association, said that thousands of farmers might go bankrupt this year without large-scale purchases from China or government assistance, and he is concerned about this.
Ragland said he still remains optimistic that China will fulfill its purchase commitments, but the reported sales volume is very low, making it difficult to have confidence in this.
"We don't want to assume they won't buy. But the day when the soybeans are actually delivered, the money is received, and the transaction is completed, will be a beautiful day," Ragland said.
China is the world's largest buyer of beans. Last year, China purchased more than $12.5 billion worth of U.S. soybeans, while total U.S. exports were approximately $24.5 billion.
However, after Trump imposed tariffs, China stopped purchasing U.S. soybeans this year and continued to shift more purchases to South America. World Bank data shows that even before the trade war, last year Brazil's soybeans accounted for more than 70% of China's imports, while the U.S. share fell to 21%.
Ragland said that every supplier he contacted told him that they would raise prices next year, which will continue to put pressure on farmers.
"When we are developing our 2026 budget, we still expect serious losses, and fiscal deficits are likely to occur," he said.
Original: www.toutiao.com/article/1848814448238656/
Statement: This article represents the views of the author himself.