Trade

Trump Claims Huge Farm Purchases That Still Haven’t Happened

Written by SK Ashby

Both China and Donald Trump have claimed that the former has resumed a limited amount of purchases of American agriculture, with Trump claiming that China is importing "millions" of tonnes of soy beans, but it's not clear if that's actually true. At least not yet.

While Department of Agriculture data shows that American farmers shipped a million tonnes since the end of June, that reflects purchases made earlier this year before Trump struck a "truce" with Chinese President Xi Jinping on the sidelines of the G-20 summit.

Recent customs data from China shows that the nation imported far less than that during June and imports were actually lower than they have been as recently as May before Trump's truce.

U.S. Department of Agriculture (USDA) data shows that just 1.02 million tonnes of soybeans were shipped to China for the period starting from the G20 meeting June 28 to the week ended July 18, the most recent date for which data is available. These shipments reflect purchases made earlier this year, and the USDA is expected to release new data this week. [...]

Meanwhile customs data released on Saturday showed China brought in 614,805 tonnes of soybeans from the United States in June, down 2.5% from June 2018 and down 37% from 977,024 tonnes in May.

Quick napkin math tells me that even if future Chinese customs data mirrors the 1.02 million figure published by the Department of Agriculture, that will mean imports have only really increased by about 300,000 tones since June or about 25,000 since May.

Needless to say, that's not "millions." It may not even be enough to notice for most farmers.

While Chinese imports of American soybeans dropped by 37 percent between May and June of this year, they've dropped by 22 million tones or over 90 percent since 2017. Increasing exports by 25,000 tonnes or even 300,000 tonnes will barely make a dent in that figure.

If we generously assume Chinese firms already have or will slightly increase their purchases, it looks like it will only be temporary.