U.S. exporters last week loaded six soybean vessels bound for China, the most in any week since the start of the tariff war between Washington and Beijing and an encouraging sign for U.S. farmers hard hit by the trade fight.
The shipments are among the first to load and depart for China since state-owned companies booked an estimated 5 million tonnes of U.S. soy over the past month and a half as the world’s two largest economies try to resolve their trade conflict.
The U.S. Department of Agriculture on Tuesday said 416,408 tonnes of soybeans were loaded onto two ships at U.S. Gulf Coast terminals and four vessels in the Pacific Northwest in the week ended Jan. 17. That was the most since eight vessels were loaded in the week ended March 8, 2018.
“This shows that the Chinese are active in shipping out and keeping their promise that they not only bought U.S. beans, but they’re taking U.S. beans. We see that as encouraging,” said Dan Basse, president of Chicago-based consultancy AgResource Co.
“I think we’re going to see increasing numbers for loadings to China going into the middle to end of February. The Chinese want to look like they’re walking the walk,” he said.
With soybean prices hovering near decade lows and U.S. stockpiles of the oilseed at historic highs, exporters have a narrow window in which to sell and ship U.S. beans to China ahead of a bumper Brazilian harvest.
Some are also worried about China’s demand for soybeans as an outbreak of African swine fever shrinks its herd of hogs, which eat soymeal.
U.S. soybean exports to all destinations are at the lowest level in seven years because of the steep drop in shipments to China, the world’s top soy buyer.
Beijing raised tariffs on U.S. imports by 25 percent on July 6 and shifted most of its buying to South America. Although the tariffs are waived for purchases destined for China’s state reserves, they remain in place for privately owned buyers.
Grain traders are monitoring any progress in U.S.-China trade talks as a March 2 deadline for striking a deal nears.
The Trump administration rejected an offer from China for preparatory trade talks this week ahead of high-level negotiations scheduled for next week, the Financial Times reported on Tuesday, citing people briefed on the talks.
