DES MOINES, Iowa, July 13, 2017 – A Chinese delegation was in Des Moines, Iowa, Thursday where they signed an agreement to buy 12.53 million metric tons of U.S. soybeans.
The purchase (460 million bushels) would account for about 11 percent of this year’s projected national harvest and is the second-largest purchase agreement ever in what has become annual events in Des Moines. China is the biggest customer for U.S. soybeans.
Jeffrey Xu, representing the Shanghai branch of Shandong Bohi Industry Co., China’s demand for U.S. soybeans continues to increase.
“We see the U.S. soybean for the quality, especially for the protein. When the protein is higher, we have better quality, so we prefer to import more U.S. soybeans,” Xu said.
Xu described U.S. soybeans as a sustainable and reliable product for China’s crushing industry. The largest buy occurred in 2015 when Chinese importers signed a nonbinding agreement to buy 13.18 million tons of U.S. soybeans.
Iowa Secretary of Agriculture Bill Northey said the effects of the Chinese purchase are far-reaching.
“The first thing you think about is the impact on folks back on the farm,” he said. “That demand impacts farmers eventually,” Northey said. “Think about how that demand has grown over the last 20 years. China continues to buy more soybeans every year. Today’s number ends up being a much larger number than it used to be, and it is something that sometimes surprises us farmers … I’m excited for the impact on producers.”
Northey also said the trade relationship between China and the United States cannot be overstated.
“Without the market here, we’d be in much tougher shape out on the farm,” Northey said. “Think back to those producers and how excited they are to be able to have this in Iowa, and have this kind of news that not only gives a sense of how these beans are getting sold now, but a reminder that this market is going to be there too.”
Other items the Chinse agreed to buy at the ceremony included 371 metric tons of pork and beef. The entire purchase, including the soybeans, would top $5 billion. The United States Soybean Export Council hosted the signing ceremony.
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