WASHINGTON — China purchased a total of 1.206 million tonnes of US grain, according to a March 20 US Department of Agriculture (USDA) report.

The shipments include:

• 756,000 tonnes of corn delivery during 2019-2020 marketing year
• 340,000 tonnes of hard red winter wheat for 2020-21 market year
• 110,000 tonnes of soybean during 2019-20 marketing year.

According to the USDA, the marketing year for wheat began June 1 and corn and soybeans began Sept. 1.

The United States and China have been in an ongoing trade dispute since China raised import tariffs by 25% on US soybeans in July 2018 in retaliation for US duties on Chinese goods. In January, the United States and China came to an accord and signed the first phase of its trade agreement. It included a commitment by China that it will make additional purchases of US goods and services in the coming years.

The US Wheat Associates (USW) said the new purchase of US wheat by China is the first step in fulfilling the trade pact.

“The USDA report today that Chinese buyers have purchased 340,000 tonnes, or about 12.5 million bus, of US hard red winter (HRW) wheat for delivery in the 2020-21 marketing year is very good news for US wheat farmers,” said Vince Peterson, president of USW. “This is a significant purchase volume and the largest since China implemented retaliatory tariffs on US wheat in March 2018. 

"This purchase falls under China’s 9.64 million (tonne) tariff rate quota (TRQ). China has agreed to work toward filling its TRQ for wheat imports. As USW has noted, if the changes are in fact implemented, and Chinese millers can respond to market signals, most of the TRQ should be used. US wheat farmers are in a good position to help fill the TRQ given current export prices, relatively low freight rates and the ready supply of the wheat classes China needs.”