COFCO has signed multi-billion dollar deals to purchase Brazilian soybeans and oil.
China’s COFCO Oils & Oilseeds has signed agreements to buy nearly 20 million tonnes of Brazilian soybeans, soybean oil, palm oil and other products worth over $10 billion. The deals, signed with ADM, Bunge, Cargill and Louis Dreyfus, exclude U.S. origins, as tariffs on American goods—such as 13% on soybeans—still limit private imports. Traders are watching these state purchases closely following U.S. claims that China committed to buying 12 million tonnes of soybeans, a figure China has not confirmed.
The oilseed division of China’s COFCO Corporation announced the signing of agreements to purchase nearly 20 million tonnes of Brazilian soybeans, soybean oil, palm oil, and other agricultural products worth more than $10 billion, Reuters reports.
Contracts with traders such as ADM, Bunge, Cargill and Louis Dreyfus were signed last week at the China International Expo in Shanghai, COFCO Oils & Oilseeds said in a statement on its official WeChat account.
The statement made no mention of agricultural products originating in the United States. China previously purchased several shipments of American agricultural products, including soybeans and wheat, as a gesture of goodwill amid improving trade relations with the United States.
Despite reducing tariffs on a number of US agricultural products, China maintained a 10% tariff on all US imports, limiting expectations for a broader recovery in trade between the two countries. For example, tariffs on soybeans were reduced from 23% to 13%, but remain too high for private importers.
Traders are monitoring large purchases by state-owned companies like COFCO after the White House announced that Beijing had committed to purchasing 12 million tons of soybeans by the end of the year. China has not confirmed this information.
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Source : Ukr Agro Consult
