China Inc returns to US soybean market

BEIJING/SINGAPORE: China’s state grain stockpiler has returned this week to the US soybean market for the first time since early April, a sign Beijing is preparing to resume purchases as trade tensions between the world’s top two economies ease, two sources said.
The renewed interest in the oilseed, used in animal feed, follows Beijing’s pledge at the weekend to buy more US goods from its top trading partner, including agricultural products. China made the pledge to avert a trade war that could damage the global economy.
As the two sides stepped back from a full-blown trade war, Washington also neared a deal on Tuesday to lift its ban on US firms supplying Chinese telecoms gear maker ZTE Corp, and Beijing announced tariff cuts on car imports. State grains buyer Sinograin asked about US-origin soybean prices this week after being largely absent for the last six weeks, two sources with knowledge of the matter said.
“Sinograin is in the market today asking US suppliers to make offers for shipment of old crop as well as new crop beans for shipment August onwards,” said a source who works at a private soybean crushing company in China.
Sinograin’s requests for prices were interpreted as a sign that government curbs on buying American goods had been lifted.
“It is a clear message to even private companies that it is okay now to import US beans,” the source said. Soybeans are America’s top agricultural export to China, worth $12 billion last year. Two other sources briefed on the matter said state grain trader Cofco was also now permitted to buy US soybeans, with the restrictions put in place during high trade tensions removed. — Reuters