News

Short U.S.-China trade extension keeps ag markets waiting

Market analyst Randy Martinson says he’s slightly disappointed the U.S. and China have only extended the Busan Agreement through January 2027.

“The U.S. was hoping for a longer extension to give us more time and security on where the trade is going to take place,” he says.

However, Martinson tells Brownfield it means trade talks will continue. “We’ll see how things develop today if we’ll see any tariff changes.”

The Busan Agreement was reached between the U.S. and China last October to deescalate tariffs, postponing new tariff hikes for a year and reducing some tariffs. It’s also where China made its commitment to purchase 12 million metric tons of U.S. soybeans.

He says there’s still an interest in learning more about China’s $17 billion purchase commitment for U.S. ag products, set earlier this year.

“It’s going to be non-soybeans. Does that mean it’s going to be corn, wheat or sorghum? Or does it mean it’s lumber or other products? I think that’s the market’s focus: what does that entail, what products does it encompass and how it impacts the U.S.”

China has been in the market for U.S. soybeans in recent weeks. Martinson, based in eastern North Dakota, says having another demand source has helped strengthen local soybean basis this fall.

Around 60 percent of the soybeans raised in the Northern Plains are exported, with most going to China, according to Northern Soy Marketing.

The U.S. and China are meeting today in Washington D.C.