A spokesman for the Chinese officials who signed the agreement during a ceremony at the Chicago Board of Trade said their companies could buy another 2.5 million tons “if the price was suitable.”
Representatives of the United Soybean Board and American Soybean Association credited soybean checkoff international marketing efforts for the intended purchases by China, which is now the largest customer for U.S. soybeans. China has imported more than 282 million bushels of U.S. beans in the past trading year.
"China represents the most important buyer of U.S. soybeans," said Criss Davis, USB Chairman and a soybean farmer from Shullsburg, Wis. "This contract signing represents further indication of our commitment to being a reliable supplier of quality soybeans in the future."
Besides the USB and ASA activities, representatives from Bunge North America and Cargill hosted a tour of the export facilities in New Orleans and presented the Chinese delegation with information on the U.S. soybean industry.
The soybean delegation included representatives from major Chinese soybean buyers, including the East Ocean Grains & Oil Industries Co. Ltd., the largest oilseed buyer in the world.
"We are hoping that this event will be a watershed. The market for U.S. soybeans in China is expanding at an incredible rate," says Zhang Xiao Ping, assistant director for the ASA in Beijing, China. "This is a great opportunity for the United States to ensure its share of this hungry and growing need for soy protein and soybean oil."
The reason for this great demand is twofold. According to researchers at the Center for Chinese Agricultural Policy, projections show that while total Chinese agriculture may drop 5 percent, animal agriculture will steadily increase. If this occurs as expected, the need for high-quality soybean meal will rise sharply.
China has also experienced a resurgent economy for the past several years. This increase in income gives the Chinese more money to spend on soybean oil-based products.
To address this shortened supply and increasing demand, the soybean checkoff, through programs like the Better Bean Initiative, remains committed to supplying China with soybeans that produce a higher quality soybean meal.
"The soybean checkoff will continue to fund programs to assist in China's agricultural development and increase their use of quality soy protein in human diets," says Davis. "We also intend to do our part to better inform our American farmers of the important market that China represents for our soybeans."
The Chinese soy mission was delayed after the Bush administration announced it was accepting a petition to impose the safeguard provisions in China’s WTO accession agreement in three categories of textile products.
The petition was filed by U.S. textile manufacturing organizations who complained that Chinese imports in the three product categories had grown by more than 600 percent since China joined the WTO and gained increased access to the U.S. apparel market in 2001.
Representatives of the U.S. North America Export Grain Association said they were optimistic that a wheat-buying delegation from China would visit the United States in January.