China needs “explosive” buying to meet U.S. farm import target

 

By Hallie Gu and Karl Plume, Thomson Reuters

via The Mighty 790 KFGO | KFGO - Jul 29, 2020

 

BEIJING/CHICAGO (Reuters) - With nearly seven months gone, an ambitious $36.5 billion target for Chinese imports of U.S. farm goods this year may not be quite out of reach, but it's looking like a big, big stretch.

 

By end-May, imports were running behind 2017 levels - rather than 50% ahead as needed - and while orders for China's main farm import, soybeans, have started to pick up, scorching levels of buying would be needed to hit the mark.

 

Add in a rapid deterioration in U.S.-China relations, an upcoming U.S. election, a global pandemic and questions over just how much soybeans China actually needs, and farmers and analysts say it may be a stretch too far.

 

"It just doesn't seem likely to me," said John Payne, senior futures & options broker with Daniels Trading in Chicago. "If the global economy was more normal then maybe, but you have this whole COVID problem."

 

Beijing and Washington sealed their Phase 1 trade deal in January after two years of acrimony and a steep slump in imports by one of the biggest buyers of U.S. agricultural goods.

 

Analysts at the time expressed reservations about the farm goods target, which is a quarter above 2013's all-time high of $29 billion.

 

Still, Chinese buyers stepped up purchases this year of a range of farm imports, sealing record deals in corn and meat imports, prompting some optimism.

 

"If I were to grade them today, we went from a C- to a B, and if it continues maybe we can start to see higher levels. But it needs to be a continual, ongoing affair," said Dan Basse, president of AgResource Co in Chicago.

 

EYES ON SOY ...

 

OTHER IMPORTS ...

 

POLITICAL WILL ...

 

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https://kfgo.com/2020/07/29/china-needs-explosive-buying-to-meet-u-s-farm-import-target/