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China to Buy Another 12 Million T of U.S. Soybeans in 2017/18 in $5 Billion Deals
By Dominique Patton
BEIJING, Nov 9 (Reuters) - The United States soybean industry has signed two letters of intent with Chinese importers covering a $5 billion purchase of an additional 12 million tonnes of soybeans in the 2017/18 marketing year.
The nonbinding agreements, disclosed by the U.S. Soybean Export Council (USSEC) in a statement, are among a series of trade deals announced during the visit of U.S. President Donald Trump to Beijing. China is the world’s top soybean buyer, and the U.S. is its second supplier after Brazil.
In the first agreement, signed on November 8, the China Chamber of Commerce of Foodstuffs and Native Produce said it intended to purchase 8 million tonnes of U.S. soybeans worth $3.4 billion.
A second agreement will be signed on Thursday between grains trader ADM and China’s COFCO for intent to purchase 4 million tonnes of soybeans worth $1.6 billion, said the USSEC.
The agreements come as U.S. farmers seek to export more beans after growing a record crop.
China-based traders said the trade accords were similar to regular framework deals signed by Chinese buyers every year at the start of a new marketing season.
“Everyone knows this is only a frame, you don’t need to fulfil it,” said a China-based trader who declined to be identified.
“I don’t think it will affect the market at all.”
Chinese importers had already pledged to buy 12.53 million tonnes of U.S. soybeans this year during a visit to the U.S. in July.
Separately, China’s agriculture ministry revised its forecast for soybean imports in the 2017/18 crop year on Thursday to 95.97 million tonnes from a previous forecast of 94.5 million tonnes. (Reporting by Dominique Patton; editing by Kenneth Maxwell)
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