That retaliation China promised after popular vote loser Donald Trump's tariffs? The retaliation that threatens to hit some of his biggest supporters the hardest? Looks like China really means it.
The world’s biggest oilseed processor just confirmed one of the soybean market’s biggest fears: China has essentially stopped buying U.S. supplies amid the brewing trade war.
“Whatever they’re buying is non-U.S.,” Bunge Ltd. Chief Executive Officer Soren Schroder said in a telephone interview Wednesday. “They’re buying beans in Canada, in Brazil, mostly Brazil, but very deliberately not buying anything from the U.S.” […]
It’s “very clear” that the trade tensions have already stopped China from buying U.S. supplies, Schroder said. “How long that will last, who knows? But so long as there is this big cloud of uncertainty, that’s likely to continue.”
By the middle of April, China had cancelled a net 62,690 metric tons of soybean purchases according to USDA data for the current market year, which ends August 31. Our loss will apparently be Brazil's gain, "as it sells 73.1 million tons abroad versus 56.2 million from the U.S., the USDA estimates." China is the second largest market for agricultural exports from the U.S., with soybeans being one of the top products.
Add to this the House Republicans jeopardizing the farm bill by turning it into a fight over making people go hungry, and the 2018 election is looking more and more interesting. As Mark Sumner points out, farmers in the Midwest are already feeling the pain. When farmers are hit economically, farm communities feel it. This fall some of the tightest races are going to be in states that have large agricultural interests. There are key senate races in Missouri, Indiana and North Dakota and governor races in Ohio, Michigan, Iowa and Minnesota. The party of Trump might be feeling some pain this November.