China Commits To Buy U.S. Farm Purchases, But Just How Much Is A Concern
China has promised to buy U.S. farm products, but how much, the time frame for purchases, and what the U.S. will give in return are questions yet to be answered, according to The Wall Street Journal.
Beijing has been encouraging the U.S. to drop plans to impose new 15 percent tariffs on $156 billion in consumer goods starting December 15, and reports show that they are leveraging farm purchases.
President Trump said Friday that China will reach the $50 billion range in “less than two years.” This $50 billion mark is far higher than what China has historically spent in one year and would be hard for Beijing to accomplish.
U.S. exports of soybeans, sorghum, pork, and other agricultural products to China peaked at $29 billion in 2013 and fell to $24 billion in 2017 before the start of the trade war. According to Commerce Department Data, these exports have fallen to $9.2 billion over the past 12 months. Trump's $50 billion figure is one-third of the roughly $150 billion in annual U.S. agricultural exports.
Trade talks have resumed between Chinese and U.S. officials, but the hope is that a partial deal is signed by President Trump and Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation in Chile next month.
China has already ramped of purchases of U.S. farm goods in recent weeks and is willing to increase soybean purchases more. The skepticism around the $50 billion figure announced by President Trump appears to be a longshot, but serious moves in the near future could make it a reality.