U.S. agricultural trade flourishes under Phase One trade agreement

by | Oct 28, 2020 | 5 Ag Stories, News

United States farmers reap the benefits of the U.S.-China Phase One trade agreement. A newly released report outlines progress made within agriculture since the pact was implemented earlier this year.

The Office of the U.S. Trade Representative (USTR) and U.S. Department of Agriculture (USDA) on Friday issued a report, “highlighting the progress made to date in implementing the agricultural provisions in the U.S.-China Phase One Trade Agreement.”

“We’ve seen the pace of sales into China increase dramatically, especially over the past three or four months,” says Dr. Chad Hart, professor at Iowa State University.

“We’ve seen a surge from China not only on the crop side of the markets, but on the meats as well. They are getting closer to hitting those Phase One targets,” Hart says.

“China has purchased over $23 billion in agricultural products, approximately 71-percent of its target under the Phase One Agreement,” according to an Office for the U.S. Trade Representative press release. Other highlights include:

*Corn: Outstanding sale of U.S. corn to China are at an all-time high of 8.7 million tons.

*Soybeans: U.S. soybean sales for marketing year 2021 are off to the strongest start in history, with outstanding sales to China double 2017 levels.

*Pork: U.S. pork exports to China hit an all-time record in just the first five months of 2020.

*Beef: U.S. beef and beef products exports to China through August 2020 are already more than triple the total for 2017.

*Data from the Office of the U.S. Trade Representative

Hart is taken aback by improvements in corn and beef exports, as “China has not traditionally been a strong market for these commodities.”

“The biggest surprise has been the strength in the corn market,” Hart says. “We knew China would lead the way in soybean and pork exports, but the movement in corn has been surprising,” Hart says. “Traditionally, China is close to self-sufficient in corn. We have seen them step into the marketplace strongly. In fact, based upon the sales data so far, China has become our number one export destination for corn this year. The crop we’re pulling out of the field now, China’s our number one market for that.”

“On the beef side, China has been a market we’ve been boxed out of for the past couple of decades. China put us out of their market when we had the BSE incident, back in 2003. They reopened that market to us last year and now we’re seeing China in our Top 10, in terms of our export sales on the beef side,” Hart says.