Updates on U.S. China Trade

China’s top two state owned crusher bought 90 percent of all soybeans exported from the United States in the past few weeks.

China is under pressure from the Phase One Trade Deal to buy more soybeans and this, coupled with increasing freight costs, has made it hard for private crushers to compete. Large state owned companies can survive the volatility, but private firms need the soybean margin to increase $10 dollars per metric ton for them to see a viable market.

Officials should rule on trade relations between the U.S. and China by the end of the month. The decision from the World Trade Organization is to determine if the use of Section 301 tariffs violated international trade rules. The outcome will either make the case for withdrawal from the group or validate President Trump’s use of the tariffs in dispute resolution.