U.S. - China Relations
With all of the attention on coronavirus, where do things stand with China? Standard Grain’s Joe Vaclavik provided an update on a recent podcast called “Grain Markets and Other Stuff”.
Vaclavik… “Negative rhetoric regarding China from President Trump may have resulted in some grain market weakness. On Wednesday night, Trump tweeted a series of statements regarding what he called a massive disinflation campaign regarding the Chinese government and the coronavirus outbreak. Trump is also planning on some new security powers over Hong Kong, which could cause greater conflict between the U S and China. Now, maybe on the same note that U S. says that it sees progress with China in regard to the phase one trade deal. White House Advisor, Larry Kudlow told reporters that a Trade Rep Lighthizer and Treasury Secretary Mnuchin have reported to the president that the deal is intact and China has every intention of implementing it. So we very much hope that's the case. We're going to need to see a lot more purchases of ag products in order for that to be the case. China will draft a food security plan amid the virus and supply chain issues. They say it's imperative, and it's within their ability to ensure the food supply for 1.4 billion Chinese people through their own efforts. So they have recently urged state and private firms to boost inventories of products like soybeans and corn to prepare for any further disruptions.”
Many hope that food security plan will include following through on their trade deal commitments to buy U.S. products.