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China has used up almost all of its waivers to purchase American soybeans that are free of retaliatory tariffs, according to people familiar with the matter.
Chinese buyers have nearly reached their quota of about 10 million metric tons, said the people, who asked not to be identified because the information is private. Beijing is also unlikely to issue new waivers for U.S. supplies before progress is made in trade negotiations with Washington, one of the people said.
Without further waivers, Chinese crushers are unlikely to buy from the U.S., removing a key source of demand for American supplies. The Asian country may have already secured about 60-70% of its soybean needs for the first half of next year, especially given demand has contracted because of African swine fever, one of the people said.
China has been issuing waivers that allow buyers to ship in U.S. soybeans without having to pay the 30% retaliatory tariffs Beijing adopted in response to American levies. The nation’s purchases of American supplies have been viewed as a barometer of the trade negotiations.
President Donald Trump will increase tariffs on China if an agreement can’t be reached, U.S. Commerce Secretary Wilbur Ross said Monday, citing Dec. 15 as the “logical deadline.” At the same time, China wants U.S. tariffs to be rolled back as part of the phase one deal, Global Times said in a tweet Sunday.
China’s Ministry of Commerce didn’t respond to a fax seeking comment.
While China usually steps up purchases of soybeans from the U.S. at this time of year when it’s the peak sales season, the country has instead been increasing imports from Brazil, the world’s largest exporter.
Purchases of American soybeans by China stand at 9.3 million tons since the start of the season in September through Nov. 21, according to data from the U.S. Department of Agriculture.
(Updates to recast third paragraph.)
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