Days ahead of the Phase One trade deal signing between the U.S. and China, hopes appear to have dimmed somewhat for a spike this year in U.S. farm shipments overseas. China recently made large buys of Brazilian soybeans and made a pair of unexpected policy moves, two things that Reuters says have put a damper on that optimism.
China confirmed late last week that their Vice Premier will be in Washington to sign the Phase One partial trade deal with the U.S. Chinese forward purchases of Brazilian soybeans that totaled about 800,000 tons are causing doubts about whether Chinese buyers will have any need to tap into the vast soybean supplies available from the U.S. American traders who spoke anonymously with Reuters say China’s soybean needs have been covered through the first quarter of 2020.
Adding to U.S. concerns, Beijing announced plans to suspend its implementation this year of a nationwide gasoline blend that contains 10 percent ethanol. The plan originally brought about the hope that U.S. exports of the biofuel to China would leap upward, as well as hopes of more corn shipments to the country to help it produce the biofuel domestically.