“Charting is a little like surfing. You don’t have to know a lot about the physics of tides, resonance, and fluid dynamics in order to catch a good wave. You just have to be able to sense when it’s happening and then have the drive to act at the right time.” ~ Ed Seykota
Late last week, Aime Williams and Justin Jacobs reported at The Financial Times Online that, “China has purchased less than three-fifths of the US goods projected under the ‘phase one’ trade deal that paused a tariff dispute between the two countries a year ago, posing another challenge for the administration of Joe Biden in its relations with Beijing.”
The FT writers indicated that, “According to analysis from the Peterson Institute for International Economics, Beijing has purchased just 58 per cent of the US exports expected under its projections, based on data to the end of last month.”
China has bought $23.5bn of the agricultural products covered by the deal, compared with an expected first-year figure of $36.6bn.
Looking ahead, Bloomberg News reported last week that, “As the pact enters its second year, all eyes are on whether a new U.S. administration under President Joe Biden will try to renegotiate the deal.”

Meanwhile, Lingling Wei and Bob Davis reported in Saturday’s Wall Street Journal that, “Looking to reset the troubled U.S.-China relationship, Beijing is pressing for a meeting of its top diplomat with senior aides to President Biden to explore a summit between the two nations’ leaders, according to people with knowledge of the initiative.”
The Journal article also stated that, “It isn’t clear whether Mr. Biden’s choice for U.S. Trade Representative, Katherine Tai, will push for enforcement of the Phase One deal or press for a new round of negotiations.”
In more narrow reporting regarding agricultural purchases, Reuters writers Hallie Gu and Dominique Patton reported last week that, “China’s soybean imports from the United States in 2020 rose by 52.8% from a year earlier, customs data showed on Wednesday, though the stepped up buying likely fell short of what was needed to fulfil last year’s trade deal between the countries.
“The world’s top soybean buyer last year brought in 25.89 million tonnes of the oilseed from the U.S., its second-largest supplier, up from 16.94 million tonnes in 2019.”
Ag exports near 2017 levels ($24 billion)–far from targets but a good recovery from trade war. 2021 may be better yet based on sales to date. China needs protein meal and calories for meat and dairy production. https://t.co/rvmcXor9oW
— JoeGlauber–IFPRI (@JoeGlauber1) January 21, 2021
The Reuters article explained that, “Besides the push to meet the trade deal, soybean imports also rose as China rapidly replenished its pig herd after it was decimated by the deadly African swine fever during the last two years.”
🔥🔥 🧐 BREAKING: New data from #China customs shows their imports of #Phase1 🇺🇸 #agricultural products during 2020 at nearly $24B, 35% below goal, but up 65% YoY @FarmBureau pic.twitter.com/B58D0jj4XV
— John Newton (@New10_AgEcon) January 21, 2021
And a separate Reuters News article last week reported that, “China’s grains imports soared to record highs in 2020, customs data showed on Monday, after tight domestic corn supplies pushed prices to multi-year peaks, driving demand for cheaper imports.
“China, the world’s top agricultural market, bought a record 11.3 million tonnes of imported corn last year, including 2.25 million tonnes in December alone, according to General Administration of Customs data.”
China imported 2 mmt of #corn in December to put 2020 imports at 11.3 mmt. #oatt pic.twitter.com/OLHBDnS910
— Arlan Suderman (@ArlanFF101) January 20, 2021
“China also imported a record 8.38 million tonnes of wheat, against a quota of 9.64 million tonnes,” the Reuters article said.
In other news impacting Chinese grain demand, Reuters writer Dominique Patton reported on Thursday that, “A new form of African swine fever identified in Chinese pig farms is most likely caused by illicit vaccines, industry insiders say, a fresh blow to the world’s largest pork producer, still recovering from a devastating epidemic of the virus.
“Two new strains of African swine fever have infected more than 1,000 sows on several farms owned by New Hope Liuhe, China’s fourth-largest producer, as well as pigs being fattened for the firm by contract farmers, said Yan Zhichun, the company’s chief science officer.
“Though the strains, which are missing one or two key genes present in the wild African swine fever virus, don’t kill pigs like the disease that ravaged China’s farms in 2018 and 2019, they cause a chronic condition that reduces the number of healthy piglets born, Yan told Reuters. At New Hope, and many large producers, infected pigs are culled to prevent the spread, making the disease effectively fatal.”
Lawsuit Alleges Crop Input Suppliers Collude In Pricing, by Katie Dehlinger, DTN
new lawsuit alleges crop input manufacturers, wholesalers and retailers coordinated a boycott of online sales platforms such as Farmers Business Network and AgVend to prevent greater price transparency, a move the lawsuit argues amounts to collusion to keep prices artificially high in violation of antitrust laws.
The lawsuit, which seeks class-action status, was filed in the U.S. District Court for southern Illinois by Barbara Piper on behalf of her late husband’s estate. Michael Piper, who farmed near Mt. Vernon, Illinois, died in 2017. The lawsuit argues that Piper paid more for Liberty herbicide than what would have been a sustainable price in a genuinely competitive market, just like many other farmers across the country.
Fourteen defendants are named in the legal filing, and among them, crop input manufacturers such as Bayer Crop Science, Corteva, Syngenta and BASF. The lawsuit alleges large wholesalers, particularly Cargill, Winfield Solutions and Univar Solutions, were complicit in anti-competitive practices along with retailers, including CHS, Nutrien Ag Solutions, Growmark, Simplot, Tenkoz and Federated Co-operatives.
In general, the companies named in the lawsuit say they believe the lawsuit is without merit and they intend to put forth a vigorous defense.
Boycotting Online Sales Platforms
The lawsuit argues the existing crop input distribution process, which uses a network of authorized retailers to reach customers, is designed to conceal pricing information, allowing companies to sell seed, chemicals and other inputs at higher profit margins while depriving farmers of information that would allow them to make better decisions.
“Farmers, through no fault of their own, are unwittingly paying more for crop inputs than they would in a truly competitive market,” the lawsuit states, arguing that input costs have risen substantially more than yields over the past 20 years. It argues that disparity is pushing farmers out of business. The lawsuit never mentions commodity markets or other factors that influence farm profitability.
The lawsuit details several companies’ reaction to Farmers Business Network’s (FBN) entry into the market, and the general concern that was widely discussed at CropLife America’s annual meeting in 2017. CropLife America is a trade association that represents major crop input manufacturers, wholesalers and retailers, but because there are no farmers on the board of directors, the lawsuit alleges, the organization’s meetings make “an ideal vehicle for collusion.”
The lawsuit alleges that retailer and wholesaler defendants pressured the manufacturers to refuse to supply FBN because electronic platforms would cut into their market positions and profit margins and that manufacturers complied by imposing strict conditions in its contracts with authorized retailers to prevent sales to the startup.
FBN attempted to break the boycott by purchasing Yorkton Distributors, a Canada-based retailer with decades-old supply agreements, but most of the manufacturing defendants canceled their contracts with Yorkton within a few months of the transaction. Instead, FBN began developing its own inputs.
AgVend, another online platform, shut down its efforts at online sales after manufacturers’ refusal to supply it.
“As a result of the Retailer, Wholesaler, and Manufacturer Defendants’ coordinated actions, farmers were deprived of the opportunity to purchase crop inputs at transparent, lower prices from electronic platforms. Instead, they were forced to continue paying artificially high prices for crop inputs purchased from local retailers subject to Defendants’ confidentiality requirements,” the lawsuit stated.
Canada’s Competition Bureau is formally investigating collusion, and the lawsuit said the U.S. Department of Justice is also considering opening a case.
Responses from Defendants
A representative from Corteva said they’re aware of the lawsuit “involving allegations relating to the manner in which several agricultural industry members marketed and sold products. Corteva believes that the allegations are factually and legally unsupported and will vigorously defend the case.”
A spokesperson for Syngenta said the company “is dedicated to the support and success of our customers, and we will vigorously defend any allegations that our actions have been improper or illegal.”
Bayer said it has not yet been served with the complaint, “and will review it in due course. Based on information in published reports, we believe the markets identified in this action are competitive, and the complaint has no merit.”
BASF also said it is aware of the lawsuit “alleging BASF and certain other manufacturers, distributors, and retailers of crop inputs violated antitrust laws. BASF strongly disagrees with the allegations in the lawsuit and intends to defend itself vigorously. Most importantly, BASF is committed to a fair and competitive marketplace that provides access for farmers to the critical products they need.”
A CHS representative said they’re aware of the filing, but it is company policy not to comment on pending litigation.