China and the US may sign a new agricultural agreement

China and the United States may reach an agricultural agreement at their summit this week that would expand Beijing’s grain and meat purchases, but market participants said they do not expect significant new soybean purchases beyond those agreed in last October’s agreement, Reuters reports.

Agriculture is one of the less contentious areas of bilateral relations, but the final outcome of the May 14-15 summit between US President Donald Trump and his Chinese counterpart Xi Jinping remains uncertain.

The White House is seeking greater commitments from Beijing on soybean and other agricultural purchases, and more than a dozen CEOs and top executives, including Brian Sykes, head of US grain trader Cargill, are expected to join Trump during his visit.

However, traders and analysts note that any agreement will likely be limited by Beijing’s reluctance to purchase more soybeans—the largest commodity by volume—beyond its October commitments, given weak demand and cheaper alternatives from Brazil.

At the same time, markets are anticipating new agreements on corn, sorghum, and milling wheat, as well as beef and poultry, as partly discussed during high-level talks in March.

Tags: China, corn, grain, soybean, wheat, USA, sorghum