China will remain the world’s largest soybean importer in coming years even if the trade war with the United States is not settled, but it won’t be buying as much of the oilseed, said USDA analysts on Wednesday.
Cotton growers plan to expand their plantings by a sharp 3 percent this spring, taking away land from soybeans, the most prominent casualty of the Sino-U.S. trade war, said the National Cotton Council over the weekend. Meanwhile, the USDA said the soybean stockpile will double in size by the time this year's crop is ready to harvest, creating the largest "carryover" ever.
One of the world's largest grain companies warned of a "skinny export season" for U.S. soybeans and an intergovernmental body said the United States might need to seek new markets for its cotton due to President Trump's trade war with China. Meanwhile, the Trump administration threatened on Wednesday to put 25-percent tariffs on $200 billion worth of Chinese imports as leverage for reform.
Cotton production is rising in all of the major nations growing the fiber, and the United States is leading the way with a 23-percent increase, says the International Cotton Advisory Committee. The large crop, forecast by ICAC as 10-percent larger than in 2016/17, will drive down the season-average price to 69 cents a pound, a drop of 14 cents.
A rebound in cotton plantings and yields in 2016 resulted in a dramatic surge in exports in the trade year that ended Aug. 1, according to USDA's monthly Cotton and Wool Outlook. "A large supply of high-quality cotton pushed shipments to the second-highest on record."
Cotton growers say they will expand plantings 9 percent this year, displacing corn and some wheat to chase the highest market price in four years, says the National Cotton Council. Nonetheless, "2017 is shaping up to be another challenging year," said NCC economist Jody Campiche, because of high production costs and the struggling global economy.