WASHINGTON, DC - Twenty months ago, trade leaders from the United States and China finally ended their trade war, by signing a ceasefire also known as the Phase One trade agreement, or as it is officially called, the Economic and Trade Agreement Between the United States of America and the People's Republic of China: Phase One.

Now with just four months left to go, it appears the Chinese will not be able to completely fulfill their commitments for buying U.S. agricultural goods.

As part of the trade pact, China agreed to purchase more than $200 billion of certain U.S. goods and services, including an additional $19.5 billion in agricultural commodities for 2021 (above 2017 levels), implying an annual commitment of more than $40 billion.

According to the Peterson Institute for International Economics, China's total imports of covered products in 2020 from the United States were only $99.9 billion, or 58 percent of their commitment.

Year-to-date, China's total imports of covered products were $89.4 billion, or 69 percent of the commitment, and for agricultural specifically, the Chinese have purchased 92 percent of their commitments year-to-date.

And although corn was a large contributor to the increase in the past, the Foreign Agriculture Service at USDA suggest that Chinese imports of the yellow grain will be much lower this marketing year as "domestic corn prices to fall over the next year, stock building to moderate, and demand to soften as imported corn held in reserves and other stocks finally enters the market".

Cotton, beef, soybeans, and pork are expected to remain red hot tickets for Chinese purchases for the remainder of the year.
(SOURCE: All Ag News)