When the U.S. and China signed a partial trade deal in January, President Trump promised that China would purchase about $40 billion in American agriculture products this year, but on Thursday a top government economist predicted a much smaller haul.
At the U.S. Department of Agriculture's Agricultural Outlook Forum, Robert Johansson, the department's chief economist, "projected that agricultural exports to China would reach roughly $14 billion in the year that ends Sept. 30, a $4 billion increase from one year ago," Laura Reiley reports for The Washington Post. "At a news conference later at the event, Agriculture Secretary Sonny Perdue said that enforcing China’s purchase commitments in the trade deal remained a concern and that variables such as the coronavirus outbreak made predictions difficult."
The Phase One deal specified that "China was to ensure additional purchases of U.S. agriculture products by $32 billion over two years, $12.5 billion in 2020 over the 2017 baseline of $24 billion and $19.5 billion over that baseline in 2021. This would mean total agricultural and seafood exports to China in 2020 would be $36.5 billion and up to $43.5 billion in 2021," Reiley reports.
Johansson told the Post that some of the discrepancy between the promised buy and the projected buy is that his projections were for a fiscal year, so October, November and December numbers weren't included, Reiley reports.
However, market conditions could be another big factor: the deal specifies that China will make more purchases as long as it doesn't disrupt other trade relationships. China has already purchased a great deal of its soybean needs for this year from Brazil.
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