Stricter 2018 Chinese rules could hurt U.S. soybean exports

In Illinois, half of U.S. soybeans exported to China this year would not meet Chinese rules for routine delivery in 2018, according to shipping data reviewed by Reuters. As of January 1st, more stringent quality rules by China could require additional processing of U.S. oilseeds at Chinese ports to remove impurities, leading to increased costs and lower sales

Half of the 473 vessel shipments in 2017 and half the total 27.5 million tonnes of U.S. soybeans exported to China this year contained more than 1 percent of foreign material, exceeding a new standard for speedy delivery, according to USDA data compiled by grain broker McDonald Pelz Global Commodities LLC and reported by Reuters.

“It’s going to raise the costs of sending the soybeans to China,” Richard Wilkins, a Delaware farmer and former chairman of the American Soybean Association told Reuters. Wilkins said the change would deliver higher-grade soybeans to Chinese buyers without requiring a premium price. “They basically want to pay us for No. 2 grade but they want it to be No. 1 grade,” he told Reuters.

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