LONDON (Reuters) – Top soybean buyer China could not only end up paying more for the oilseed if it imposes tariffs on U.S. imports but may also create new buyers for American supplies as the move shakes up global trade flows. China’s voracious appetite for the bean outstrips forecast global exports, excluding the United States, so trade flows may emerge with crops from the fields of Illinois and Iowa possibly set for a detour via crushing plants in South America. The proposal by China for a 25 percent tariff, part of its response to U.S. plans to impose tariffs on a range of Chinese products, has already driven up prices in alternative suppliers Brazil and Argentina. The dispute is the latest of a series of trade battles since Donald Trump became U.S. President in January 2017, which are already taking a toll on the country’s farm sector. Mexican buyers boosted purchases of corn from Brazil after Trump threatened to tear up the North American Free Trade Agreement, while his decision not to join the Trans-Pacific Partnership threatens U.S. wheat sales to Japan. “The whole mess of the trade war between the United States and China made internal prices rise here,”… continue reading
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Source: CTRM Center