Soybean farmers were among those on Sunday praising a trade framework announced by U.S. and Chinese leaders that could end China’s freeze on buying U.S. agricultural products, according to Chris Clayton at DTN.
The U.S.-China framework was laid out on Sunday while Trump administration officials were holding talks in Malaysia. The administration also announced four smaller trade deals with Cambodia, Malaysia, Thailand and Vietnam — all of which have provisions to open those markets to more U.S. food and agricultural products as well.
Treasury Secretary Scott Bessent made the rounds on Sunday news programs saying he thinks a trade “framework” has been negotiated to set up for President Donald Trump and Chinese President Xi Jinping who are set to meet Thursday in South Korea.
The news injects some optimism into commodity markets that have been suppressed in part because of the lack of export sales to China. The announcements could push prices back towards September highs, “at the very least,” said DTN Lead Market Analyst Rhett Montgomery.
“From there, all eyes will be on Trump and Xi Thursday. It seems like the markets are ready and looking for a good reason to spark the post-harvest rally and this may be it,” Montgomery said. “From there we will see what the fine details say regarding soybeans, but I still tend to think we don’t necessarily need a huge commitment of volume from China to make the balance sheet interesting, just an elimination (or vast reduction) of the 23% tariff would immediately make U.S. beans the most affordable option for Chinese crushers. Of course, any volume commitment would likely be seen as extremely bullish in the short term to the soybean market, and traders may worry later if the goals are attainable or sustainable in the long run.”
Bessent, on Face the Nation, was asked specifically about whether U.S. soybean farmers would be again selling soybeans to China. “I’m not going to give you the details here, but I can tell you that the soybean farmers are going to be extremely happy with this deal for this year and for the coming years,” Bessent said.
Bessent added, “I believe we have brought the market back into equilibrium and I believe the Chinese will be making substantial purchases again.”
SOYBEAN FARMERS WELCOME REPORTS
Kentucky farmer Caleb Ragland, president of the American Soybean Association (ASA), said fellow soybean farmers welcome reports that the two countries were prioritizing agricultural trade as part of their talks.
“ASA is encouraged by Secretary Bessent’s comments that trade talks with China are productive and include U.S. soybeans. Signals of purchase commitments are a positive step, and we look forward to learning more details later this week,” Ragland said. “We appreciate the White House and trade negotiators keeping U.S. soybeans at the center of discussions and are hopeful Thursday’s meeting between President Trump and President Xi will result in a trade deal that delivers results for our farmers.”
China’s Ministry of Commerce posted an article from the state-owned media Xinhua, detailing the trade talks between U.S. and China officials. The report stated the two sides discussed “key trade and economic issues of mutual concern, including the U.S. Section 301 measures on China’s maritime logistics and shipbuilding industries, the extension of the suspension period for reciprocal tariffs, fentanyl tariffs and law enforcement cooperation, agricultural product trade, and export controls. The two sides reached a basic consensus on arrangements to address their respective concerns.”
The framework with China also comes just days after the U.S. Trade Representative’s Office (USTR) announced it had launched another Section 301 investigation into China to determine whether China fully implemented its commitments under the 2020 Phase One Agreement. USTR stated its official export data shows China fell short of its purchase commitments. China had been expected to buy $40 billion a year in agricultural products, but peaked at about $38 billion in 2022.
Ambassador Jamieson Greer issued the following statement on President Trump securing Agreements on Reciprocal Trade with Malaysia and Cambodia and reaching Frameworks for Agreements on Reciprocal Trade with Thailand and Vietnam.
“President Trump continues to secure historic trade deals to lower tariffs on U.S. exports and eliminate trade barriers, strengthening America’s economic and national security interests,” said Ambassador Greer. “These landmark deals demonstrate that America can maintain tariffs to shrink the goods trade deficit while opening new markets for American farmers, ranchers, workers, and manufacturers. I thank my counterparts from Malaysia, Cambodia, Thailand, and Vietnam for their collaboration and commitment in achieving a more balanced trade relationship with the United States.”
To read the Joint Statement, Fact Sheet, and text of the U.S.-Malaysia Agreement, click here.
To read the Joint Statement, Fact Sheet, and text of the U.S.-Cambodia Agreement, click here.
To read the Joint Statement on U.S.-Thailand Framework, click here, and to read the Fact Sheet, click here.
To read the Joint Statement on the U.S.-Vietnam Framework, click here, and to read the Fact Sheet, click here.
