On Friday, December 1, 2018 President Trump declared that the impending bump to 25% duties on the third list of Chinese tariffs would be postponed for 3 months moving the implementation date to March 2, 2019. The delay in implementation gives both countries time to negotiate trade terms for quieting the escalating trade tit-for-tat. The US says China agreed to “purchase a not yet agreed upon, but very substantial, amount of agricultural, energy, industrial, and other products from the United States to reduce the trade imbalance between our two countries”.
On December 18th the Chinese government agreed to purchase 1.19 million metric tons of US Soybeans, marking the first purchase of significant agriculture in the planned agreement. Despite the order, and security it brings to ailing farmers, the US Government again authorized $4.7 billion in aid to those farmers who’ve been negatively impacted during these trade disputes. While there is no further aid planned for farmers in 2019, more funds could be necessary as the final details of the newest trade agreement are worked out with China.
This most recent purchase by China and at least 1.4 million tons reported by USDA reignite shipping that had all but halted after Chinese purchases of American beans ended. However current data shows China buys 30 million to 35 million tons of U.S. soybeans in a normal year as the largest importer of U.S. soy.