Recently, China and the United States held a new round of trade talks in Kuala Lumpur. Although the specific details are not fully disclosed, the overall atmosphere is obviously much easier than that of some time ago. American farmers even began to use "good partners" to describe China, and they still persuaded the Trump administration that China could not be forced to do anything. Sino-US relations should be beneficial to everyone.
This statement from the mouth of American farmers can be said to be a complete denial of Trump's tariff policy. At the same time, it also points out a reality that the United States has been reluctant to face up to: with the strength of China and the United States today, it can't win China by coercion, pressure and abuse.
Burrill, 72, is a farmer in Maryland, USA and a supporter of Trump. He believes Trump is a successful businessman, but does not agree with Trump's tariff policies and does not understand agriculture.
The price of soybeans dropped 60 percent more than two years ago, and more than two hundred farms filed for bankruptcy this year, with some farmers expecting their own losses to exceed $400,000.
And what they want is very simple, that is, China, a stable and huge buyer. In the words of the representative of the Illinois Soybean Association, what they really need is a market, not a bailout. Once China, a big customer, turns to others, it will be difficult to pull it back. Today, Brazilian soybeans account for more than 70% of China's imports, and the United States is almost zero. This situation is difficult to reverse in a short time.
Interestingly, most of these peasants are Republican “cash stores”, but now even they are beginning to publicly question Trump’s tariff strategy.This shows that China’s counter-reaction is powerful. These American peasants are under cost pressure from the tariff war, while looking at the market share being swallowed by competitors, even if they support Trump, should be awake.
China's ambassador to the United States, Xi Jinping, has clearly pointed out that China's agricultural advantages are complementary, cooperation can both enrich the Chinese consumers' "carton of food", and also blow up the American farmers' "money bag".This was a win-win buying and selling, but was played by American politicians as a zero-sum game.The result is that China turned to change sellers, Brazil, Argentina are waiting, American bean farmers can only complain hard, wait for government subsidies to meet.
Under heavy pressure, American farmers also see clearly, Trump's strategy is not useful at all, China is a partner, not an opponent, is a "good partner" that can earn money together. want to force China to the pace of the United States, it is not possible at all, China has a broad market, or the core of the global supply chain, in the hand a lot of codes, a lot of space, can choose the Brazilian soybeans, Russian grains, and even can increase their own output, and strategic reserves.
At the same time, Reuters on October 29, that China Food and Agriculture Group purchased three batches of U.S. soybeans, totaling 180,000 tons, scheduled to be shipped from U.S. West port in December and January. This time is crucial, as the U.S. will meet in Busan on October 30, which is currently in the wake of the U.S. soybeans export season, the purchase broke months of absence.
From a strategic perspective, this purchase is likely to be a prelude to a larger purchase. If the two sides can reach an agreement, China may purchase an additional 5 million to 10 million tons of American soybeans. This is crucial for American farmers.
At the diplomatic level, Trump said earlier that soybeans will be the key topic of this meeting. China's move is a direct response to the demands of the US and creates a good atmosphere for high-level meetings. This can also be regarded as a response to the "partnership" of American soybean farmers.
All in all, I believe this soybean war has made the United States understand that you can disagree with China, but you cannot bypass China; you can not want to rely on the China market, but you cannot afford to lose it. As for COFCO's purchase of U.S. soybeans, this is a good phenomenon for U.S. soybean farmers and Sino-US relations, but it does not mean that China's demand for U.S. soybeans will recover immediately. The problems between China and the United States cannot be solved just by a soybean deal.