China Resumes Limited US Oil purchases, Drops Google Antitrust probe Amid Trade Talk Preparations
BEIJING – China is taking incremental steps to ease trade tensions with the United States ahead of anticipated face-to-face negotiations later this year, including resuming purchases of US oil after a six-month pause and dropping an antitrust examination into GoogleS Android operating system, according to reports. However, China continues to largely avoid US soybean purchases, a pattern not seen since the 1990s, despite president Trump’s calls for a quadrupling of orders.
While a broader trade deal remains unlikely to be finalized over the phone, according to analyst Rothman, agriculture – especially soybeans – will be central to any agreement. Both sides are expected to pursue more realistic commitments than those outlined in the original Phase One agreement.
China’s avoidance of US soybeans carries supply risks.Brazilian soybean prices have risen sharply this year, and potential disruptions to the south American harvest could tighten global supply, potentially forcing china to draw on its strategic reserves. Conversely, a sudden influx of US soybeans could depress domestic soymeal prices, disrupting existing stockpiling and hedging strategies.
Purchasing managers in northern China report securing supplies only through next month due to current high inventories, with one major crusher warning of potential meal price crashes from a US soybean surge. Both sources requested anonymity.
Despite tariffs, the US remains a highly efficient, low-cost soybean supplier, and China is currently paying a premium to source beans elsewhere, according to Trivium’s Pay. During the initial trade war, China granted some exemptions allowing limited US agricultural imports even while imposing retaliatory tariffs.
“If a deal is struck, there will definitely be some level of demand for US soybeans from Chinese buyers,” Pay stated. “The issue is the trade war – not a total lack of demand.”