TRUMP: CHINA WILL BUY ‘PRACTICALLY AS MUCH AS OUR FARMERS CAN PRODUCE’

TRUMP

In a pair of tweets on Monday, President Trump touted a potential trade deal with China that would mean massive Chinese purchases of U.S. farm exports, “practically as much as our Farmers can produce.”

The tweets followed a joint statement by the two nations over the weekend that said China would import more American-made products, including “meaningful increases” in agricultural goods, in order to reduce its huge trade surplus with the United States.

The administration provided no specifics about the prospective increases. China is already the top customer for U.S. farm exports, and the USDA projects it will buy $21.6 billion worth of goods this year, accounting for roughly $1 out of every $7 in ag exports.

Commerce Secretary Wilbur Ross was scheduled to travel to China next week to try to finalize a trade agreement. U.S. and Chinese officials met for two days in Washington last week. The joint statement that followed the meetings appeared to tamp down fears of a trade war, which could lead to heavy tariffs being imposed on U.S. farm goods. While the trade meetings were ongoing, China said its Commerce Ministry had dropped an investigation of alleged dumping of U.S. sorghum. China is the world’s largest importer of sorghum, and the United States is the top exporter of the feed grain.

“China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products — would be one of the best things to happen to our farmers in many years!” tweeted Trump, adding. “On China, Barriers and Tariffs to come down for first time.” After calling on China to “continue to be strong & tight on the Border of North Korea” and venting about the Russia investigation, Trump wrote, “Under our potential deal with China, they will purchase from our Great American Farmers practically as much as our Farmers can produce.”

Soybean futures prices rose by more than 26¢, or 2%, following the U.S.-China statement on trade. Soybeans are the largest U.S. farm export to China, with sales worth $14 billion last year.

Ted McKinney, the U.S. agriculture undersecretary for trade, said during a teleconference from Beijing on Monday that he was “very cautiously optimistic” about the upcoming talks with China, reported DTN/Progressive Farmer. “I don’t want people to get overly excited.” Ag will be one of the main topics when Ross meets Chinese trade officials, said McKinney.

Agriculture Secretary Sonny Perdue wrote in an op-ed in the Omaha World-Herald that with the administration’s “aggressive approach on trade and expanding markets, we should see improved commodity prices. By finally standing up to China, this administration is seeking better market access for our farmers.”

Treasury Secretary Steve Mnuchin has said he expects ag exports to China to rise by 35% to 45%. On Monday, he said Trump has the right to reimpose tariffs on Chinese products if an agreement is not reached, reported the Associated Press.