This week (July 2nd), He Yadong, spokesperson for the Ministry of Commerce, responded to the issue of US agricultural product tariffs at a regular press conference. He Yadong stated that agricultural trade is an important part of Sino-US economic and trade cooperation. Following recent economic and trade consultations, both sides set guiding targets for expanding two-way agricultural trade and agreed in principle to include relevant agricultural products in a reciprocal tariff reduction framework arrangement.
According to Bloomberg's report on July 3, soybean futures were hovering between slight increases and decreases. Traders are weighing China's statement regarding the reduction of tariffs on US agricultural products. This move could pave the way for China to purchase US agricultural products, and the tariff reduction may result in US soybeans being priced lower than those from Brazil.
Analyst Randy Prees from Hightower Report states: “If China cancels the 10% tariffs on US goods, it will undoubtedly make American soybeans more competitive in competition with South America.”
Priscella said that reducing tariffs could also create buying opportunities for private soybean crushing companies, not just state-owned ones. After the initial easing of relations between China and the US at the end of last year, state-owned companies accounted for a significant proportion of procurement activities.
If China were to genuinely announce a reduction in tariffs, that would be a major positive news event, particularly for soybeans, but corn and wheat are likely to benefit as well. He added.
Data released by the U.S. Department of Agriculture earlier on Thursday showed that the weekly soybean exports in the United States amounted to 224,300 tons, of which China purchased 65,400 tons. Analysts surveyed by Bloomberg had previously estimated an average global sales volume of 775,000 tons.
In the Chicago futures market, soybean futures rose by 0.8% at one point, but then the increase was reversed, and the price remained flat. Corn futures also increased by 0.9%, and wheat futures rose by 1.3%. Subsequently, the increases in grain prices all narrowed.
