Gotrade News - China is expected to commit double-digit billions in annual US farm purchases over three years. The pledge follows Thursday's Trump-Xi summit in Beijing, confirmed by Trade Representative Jamieson Greer.
Greer also told Bloomberg that semiconductor export controls were not a major topic during the summit. Soybean futures still fell sharply on Thursday as traders found the new deal details too thin.
Key Takeaways
- Greer says China farm purchases could reach double-digit billions annually over the next three years.
- Chip export controls were not a major topic at the Trump-Xi bilateral meeting held in Beijing.
- July soybean futures fell 36.5 cents to $11.92 as traders wanted much firmer commitments.
Agriculture Deal Framework
According to Investing.com, Greer told Bloomberg the deal would cover aggregate farm goods, not just soybeans. He said the purchases would extend over the next three years and concentrate in the later part of each year.
The October baseline already locked in 25 million metric tons of soybeans worth more than $10 billion annually. Greer described the new tranche as additional volume across multiple commodities, signaling broader buying than the prior soybean-only arrangement.
Archer-Daniels-Midland, Archer-Daniels-Midland (ADM), and rival processor Bunge Global (BG) stand to benefit if Chinese crushers resume regular spot buying. Traders also expect tariff reductions that would let private Chinese buyers re-enter the market alongside state crop traders.
Soybean Market Reaction
As reported by Barchart, July soybean futures closed at $11.92.5, down 36.5 cents on Thursday. Soybean meal futures slipped $3.90 while soy oil dropped 44 to 83 points across contracts.
Treasury Secretary Scott Bessent told reporters that soybeans "are all taken care of," but traders received no firm purchase numbers. The thin disclosure triggered profit-taking after weeks of bullish positioning into the summit.
USDA reported weekly old-crop soybean sales of just 102,059 metric tons, the lowest figure of the year. That volume marked a 28.1% week-over-week decline, with Indonesia taking 72,600 metric tons of the total.
Brazil also pressured the complex as CONAB raised its 2025/26 crop forecast by 0.98 million tons to 180.13 million tons. The supply revision added downside risk to soft fertilizer demand at producers like Mosaic (MOS).
Per Investing.com, Greer said chip restrictions "were not a major topic of discussion" during the Beijing bilateral. He framed export policy as a balance between national security and access to overseas markets.
The Trump administration cleared Nvidia H200 exports to China in December and added conditions in January. Roughly ten Chinese firms including Alibaba, Tencent, and ByteDance hold purchase clearance, though no H200 deliveries have shipped to date.
Chinese AI developers continue rationing user access as domestic compute capacity remains constrained. Beijing wants local chip production to scale rapidly even as it views US technology as a strategic dependency risk.
Agriculture remains the cleaner near-term win for both sides as crusher demand resumes. Tech investors will need a separate framework before chip-policy clouds lift over the trade relationship.
