Soybean price surges, but traders wary
Prices for soybeans and other grains rose following the comments by President Donald Trump and Chinese President Xi Jinping after their dinner Saturday in Buenos Aires.
After the meeting, Trump said China would buy more from the United States, including agricultural products, and that during a 90-day period while the two leaders attempt to resolve trade differences, the United States would not increase tariffs on Chinese goods from 10 percent to 25 percent as planned.
“Farmers will be a a very BIG and FAST beneficiary of our deal with China,” Trump tweeted today. “They intend to start purchasing agricultural product immediately. We make the finest and cleanest product in the World, and that is what China wants. Farmers, I LOVE YOU!”
Agriculture Secretary Sonny Perdue said in a speech in Chicago that it is “yet to be determined” whether China will lift the tariffs it has placed on U.S. farm products in retaliation for the tariffs that the Trump administration has placed on Chinese steel and aluminum and other products, Reuters reported. Trump has not said the United States will lift its tariffs.
But AgriCensus, a London-based publication, noted that “China’s government in its statement simply said that it was willing to import more goods from the U.S. ‘based on the needs of the Chinese people.’”
“While the board was bullish, analysts were cautious, pointing out that there was no explicit commitment to buy U.S. soybeans or lift tariffs,” AgriCensus added.
Traders told AgriCensus that the market was waiting for “China to say something” before moving.
“The move (of futures) is smaller than we expected,” one analyst from a major Chinese crusher told AgriCensus.