Sources: China to accelerate U.S. farm purchases

After secretive talks in Hawaii, phase one catch-up pursued.

China plans to accelerate purchases of American farm goods to comply with the phase one trade deal with the U.S. following talks in Hawaii this week.

The world’s top soybean importer intends to step up buying of everything from soybeans to corn and ethanol after purchases fell behind due to coronavirus disruptions, said two people familiar with the matter, who asked not to be named because the information is private.

A separate person said the Chinese government has asked stateowned agricultural buyers to make all efforts to meet the phase one agreement. Nobody from the commerce ministry responded to a fax seeking comment.

The plan offers respite to markets concerned about trade disruptions after the countries exchanged blows over everything from the origins of the coronavirus to new security legislation in Hong Kong. U.S. equity futures, the Euro Stoxx 50, soybeans in Chicago and the yuan extended gains.

On Thursday, Secretary of State Michael Pompeo said China’s top foreign policy official committed to honor all of his nation’s commitments under the trade deal.

“During my meeting with CCP Politburo Member Yang Jiechi, he recommitted to completing and honoring all of the obligations of phase one of the trade deal between our two countries,” Pompeo said in a tweet on Thursday, using an acronym for the Chinese Communist Party.

Pompeo offered no details beyond the tweet, but that was the first substantive news out of the secretive meeting with Yang at Hickam Air Force Base in Hawaii on Wednesday.

China had asked state buyers to halt some purchases of American farm goods including soy, Bloomberg News reported this month. However, Chinese importers had continued to increase its American soy purchases, picking up 2.2 million metric tons of the oilseed in the two weeks ended June 11, according to the USDA data.