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Oilseed at heart of a trade war

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It’s all about soybean. Almost half of American soybean exports are bought by China, the world’s largest consumer of the oilseed, which explains soybean’s role as an obvious candidate for a trade-related attack by China.

The recent buildup of economic tensions has also served to highlight the U.S.’ record trade deficit with China – an estimated staggering $375.2 billion. Certainly, China’s recent transgressions regarding intellectual property rights and alleged currency manipulation have only added to the tension.

So, when President Donald Trump committed to introducing 25 per cent and 10 per cent tariffs on steel and aluminum imports respectively in late February, he merely formalized trade-related tensions that were becoming more palpable by the day. One of the U.S.’ major points of vulnerability to an economic attack, previously buried under mounds of unwieldy investment and trade treaties is now out in the open: soybean.

Out of total American agricultural exports to China last year valued at around $20 billion, soybean alone accounts for more than $12 billion. The potential loss of these exports poses a massive threat to the agricultural sector........

© The Statesman