After a meeting between the leaders of the United States and China last week, China has started purchasing American agricultural products, including wheat and sorghum. Simultaneously, Chinese state-owned enterprises held a soybean procurement signing ceremony at an international import expo in Shanghai.
China is the largest market for American farmers. Following multiple rounds of trade wars, China has turned its massive demand for agricultural products into a bargaining chip for trade negotiations, avoiding American wheat and soybeans and opting for other sources of supply.
According to Reuters, two American traders stated on Thursday (November 6) that Chinese buyers have placed orders for two shipments of American wheat, marking the first such purchases since October last year. An American industry official mentioned that a shipment of sorghum has been sent from the United States to China.
The day before, on Wednesday, Beijing confirmed that retaliatory tariffs on imported goods from the United States, including agricultural products, have been temporarily suspended. However, American soybean shipments still face a 13% tariff.
Sources informed Reuters that this batch of agricultural purchases includes a shipment of American soft white wheat and a shipment of spring wheat, weighing approximately 120,000 metric tons, scheduled to be shipped in December.
A grain trader based in Singapore, who is directly involved in wheat transactions, stated that this procurement mainly signifies China’s commitment to buying American grains, as “American wheat is not the cheapest. Therefore, the purchase of these goods is more politically motivated.”
On Thursday, a representative from a mainland agricultural business association mentioned that the COFCO Group, a Chinese state-owned food procurement company, held a soybean procurement signing ceremony during the 8th China International Import Expo (CIIE) in Shanghai, without disclosing specific details.
Following a meeting between U.S. President Trump and Chinese Communist Party leader Xi Jinping in South Korea last week, Beijing pledged to increase imports from the United States, including resuming bulk orders of soybeans.
The White House announced that China will purchase at least 12 million metric tons of American soybeans in the last two months of 2025 and at least 25 million metric tons annually over the next three years. However, Beijing has yet to confirm these specific procurement figures.
In recent times, as the market anticipates a sales recovery and South American prices have slightly dropped, Chinese importers have bought 20 shipments of cheaper Brazilian soybean goods. Before the “Trump-Xi Summit,” the COFCO Group had also purchased three shipments of American soybeans.
U.S. Treasury Secretary Benett stated to Fox Business Channel last Thursday (October 30) that China has been using American soybeans as a political pawn, but “that situation has now changed.” He mentioned that other Southeast Asian countries have also agreed to purchase an additional 19 million metric tons of American soybeans.
According to the Peterson Institute for International Economics, despite the disruptions caused by the COVID-19 pandemic in 2020, by 2021, China had only bought around 83% of the American agricultural products they had committed to purchasing, indicating the ongoing challenges in getting Beijing to fulfill agreements.