October 26, 2023
BEIJING – Chinese commodity importers have signed contracts worth billions of dollars for the purchase of farm produce from companies in the United States, which officials and experts said would benefit the US agriculture sector, and shore up market expectations toward overall economic and trade activities between the two sides.
A total of 11 commercial agreements were signed at the China-US Sustainable Agricultural Trade Forum in Des Moines, Iowa, on Monday. Experts noted that the agreements were the first of their kind to be signed since 2017 between China, the world’s largest soybean importer, and the US, the world’s second-largest producer of the oilseed.
According to a statement released by the US Soybean Export Council on Tuesday, the agreements, mostly involving soybeans, also included corn, sorghum and wheat.
Speaking at the forum, Xie Feng, the Chinese ambassador to the US, said agricultural cooperation between China and the US has considerable potential. China’s demand for high-quality agricultural products is only going to increase as the country is transitioning from a large agrarian country to a world-class agricultural powerhouse.
This will foster new opportunities for broader China-US cooperation in agricultural science and technology innovation, green development and other sectors, Xie added.
“The confidence behind these contracts allows US producers to invest where we have agricultural advantages,” said Jason Hafemeister, the acting deputy undersecretary for trade and foreign agricultural affairs at the US Department of Agriculture.
China’s imports of soybeans from the US jumped 8 percent year-on-year in the first nine months of this year to 20.08 million metric tons, while the country imported 54.87 million tons of soybeans from Brazil during the same period, up 18 percent from the previous year, according to data from the General Administration of Customs.
China has sought to diversify its sources of agricultural imports, turning more to other suppliers like Brazil for soybeans and corn, as a result of the US starting a trade war with China in 2018 and continued tensions between the two nations brought on by geopolitical concerns, said Li Haidong, a professor of US studies at China Foreign Affairs University.
After years of escalating US tariffs and rhetoric about economic “decoupling”, the deal from Chinese importers, though not enough to help reach China’s import levels before the trade war, will boost the business confidence needed for US agricultural exports, Li said.
The stable and mutually beneficial collaboration in the soy industry between China and US will serve as the ballast for successful bilateral economic and trade relations, said Jim Sutter, CEO of US Soybean Export Council.
After the signing of the agreements, the China-US Economic Working Group held its first meeting via video link on Tuesday, conducting in-depth, candid and constructive discussions on topics including the macroeconomic situation and policies of both nations and bilateral economic relations.
The global economy is in the doldrums, and trade and investment are showing a significant decline. Proceeding toward world peace and economic development as well as the welfare of humanity, China and the US should preserve sound relations and engage in thorough dialogues for more extensive cooperation, said Zhang Yansheng, chief researcher at the China Center for International Economic Exchanges.
Going forward, more tangible cooperative actions in various fields are needed from the world’s two largest economies to safeguard the stability of global industrial and supply chains and shore up business sentiments amid rising geopolitical tensions, said Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation.