World Grain - June 2020 - 24

GLOBAL AG TRADE FEELS

COVID-19 IMPACT
China unlikely to meet phase one import requirements with the US

O

ngoing measures to limit the spread of the coronavirus (COVID-19) are impacting global trade
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factor in whether China will meet its phase one trade
commitments with the United States.
To reach the target, China must double the $5 billion
of US agricultural products it imported from January
through March every quarter for the next three quarters, said Joe Glauber, senior research fellow at the
International Food Research Institute during a farmdoc webinar.
"We probably won't meet those targets," said Glauber,
who is a 30-year veteran of the US Department of
Agriculture including as its chief economist. "I think we'll
be lucky to get to the 2017 levels. There are some encouraging signs. We have made some sales of pork, cotton,
wheat, corn and sorghum but it is at a very slow pace."
As part of the phase one agreement, China has agreed
to purchase $36.5 billion in US agricultural products in
2020 ($12.5 billion above the 2017 baseline) and $43.5
billion in US agricultural products in 2021 ($19.5 billion above the 2017 baseline).
Glauber noted there have been recent Chinese purchases of US soybeans, but he added China wasn't
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volumes until late summer. Until then, Brazil was

24

expected to be China's primary source for soybeans.
Terms of the US-China trade agreement include that
purchases would be made at market prices based on
commercial considerations, and that market conditions
may dictate the timing of purchases. In other words,
China indicated it would buy products when the price
was right and that it would not necessarily discriminate
against other suppliers.
The composition of those products China buys may
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assistant professor and extension economist at Iowa
State University, during a separate farmdoc webinar.
Protein, mostly pork and beef, and consumer-oriented products such as vegetables, fruit, wine and infant
IRUPXOD ZLOO EH WZR JURXSV WKDW ZLOO VHH VLJQL¿FDQW
growth as a result of the trade agreement, he said.
Soybeans, however, are not expected to see a big increase as China continues to purchase from Brazil and
other nations. US purchases are increasing and comparable to 2019 levels, but are not exceeding that, he said.
"China has the potential and capacity to increase ag
exports from the US despite delays due to the coronaviUXV´=KDQJVDLG³:HPD\QRWVHHDUHSHDWRIZKDWZH
have been seeing in terms of the composition of what
we're selling to China. This will also be a more balanced
portfolio when we are looking at US agriculture trade."
June 2020 / World Grain / www.World-Grain.com

©freshidea - stock.adobe.com

by Susan Reidy and Jay Sjerven


http://www.World-Grain.com

World Grain - June 2020

Table of Contents for the Digital Edition of World Grain - June 2020

World Grain - June 2020 - 1
World Grain - June 2020 - 1
World Grain - June 2020 - 2
World Grain - June 2020 - 3
World Grain - June 2020 - 4
World Grain - June 2020 - 5
World Grain - June 2020 - 6
World Grain - June 2020 - 7
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https://www.nxtbook.com/sosland/wg/2013_12_01
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https://www.nxtbook.com/sosland/wg/2012_12_01
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http://digital.world-grain.com/sosland/wg/2009_12_01
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