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Bloomberg
Chinese firms have been snapping up US soybeans, but don’t mistake this as a sign of buyer confidence in upcoming trade talks.
The companies, which received a fresh 2 million-ton quota from Beijing to import American beans free of retaliatory tariffs, have been seeking soy every day so far. That’s likely because they want to rush through orders in case the talks fail and imports are halted, said Darin Friedrichs, a senior analyst at INTL FCStone’s Asia commodities division.
“The Chinese soybean purchases are a necessity and may be a sign that the crushers want to get these grades in quickly because things could change on talks,†Friedrichs said.
The wariness of commodity traders is perhaps understandable given the whipsawing in relations between President Donald Trump and counterpart Xi Jinping over the past year.
Chinese firms were issued tariff waivers in July as Beijing offered Washington an olive branch, only to see shipments stopped about a month later after talks fell apart.
Top negotiators from the two countries are expected to meet in Washington on October 10.