Iowa Soybean Association visits China
By KRISTIN DANLEY-GREINER
The rice paddies and fields of wheat and tuber dotting China’s rural landscape are much different than Iowa’s seemingly endless horizon of corn and soybean fields, but the needs are the same – crops are being raised to feed a hungry, growing population.
Recently, the Iowa Soybean Association sent a small delegation overseas to China to gauge their feel for increasing the amount of soybean exports from America to their country. American soybean exports to China have dropped by almost two-thirds ever since the trade war began last summer and tariffs were imposed on products from between both countries.
Iowa’s growers who embarked upon that trip were relieved to hear that China’s crushing businesses were just as interested in this prospect as they were. The demand for soybeans in this country will grow exponentially. In just 10 years, China will seek imports of an estimated 122.9 million metric tons of soybeans, up from 94 million metric tons in 2018. Experts anticipate a surge in soybean needs not just for human conception but also for livestock feed in China.
“We really weren’t sure what we would hear from them as we started out on our trip. But one of the first statements they made to us is that they wanted us to know that they are a strong, reliable customer for U.S. soybeans,” said Tim Bardole, vice president of the ISA who raises corn and soybeans in Greene County. “That was a great way to start out our trip, because that’s what we really wanted to hear. We weren’t sure how the trip would go, but hearing that really put us at ease for the rest of our meetings.”
Aaron Putze, communications director for the ISA, said that the organization sends a delegation overseas to China at least once a year. For this trip, Bardole was joined by ISA president Lindsay Greiner and others. Traveling to China annually is important because they are a major customer. But because of recent trade issues and tariff’s being implemented, both sides weren’t sure how tumultuous the trip would be.
“We started our trip meeting Ambassador Brandstad who commented several times how critical it is for us to reach a trade agreement with China. We heard that several times from different people, that both countries will hurt if there isn’t a trade agreement put in place,” Bardole said. “Failure is not an option.”
The delegates met with several private crushing companies who are “desparately” wanting the trade deal to be hashed out because they are missing out on opportunities.
“There are two state-run crushing companies and they’re the only ones who can buy U.S. soybeans right now, so they’re undercutting the private guys by $10-15 per ton, which makes it so the private crusher can’t make any money,” he said. “They desperately want the trade deal to be completed because they’re being hurt as much as the U.S. farmer is.”
Private entities are purchasing Brazilian beans, Bardole explained, which are priced below what U.S. soybeans would cost with tariffs, he said.
“So they’re getting gouged on both sides of this and they’re really struggling,” he said. “If there was any question in our minds when we landed in Beijing how they felt about the trade war between the countries, it was definitely put to rest very early on in our meetings and was a very consistent message all throughout that they need us just as bad as we need them.”
According to sources Bardole knows, the trade agreement is virtually done except for one component: intellectual property.
“One of the people we spoke with in China said that President Trump wants total free trade without tariffs, but in their opinion, that’s something that China will never be able to do because of the way they’re set up. They’re trying to protect their industries.”
The group moved from meeting to meeting in Beijing and Shanghai with only two hours of free time that was derailed by rain. Because it was so jampacked with meetings, Bardole said the delegation was very confident when they flew home.
“I felt like it’s the best trip I’ve been on. I felt like we made a difference. We made contact with almost 50 percent of the importers of U.S. beans. We really like what we heard from them and they seemed pleased, too,” Bardole said.
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