China cutting US soybean purchases in face of tariffs threat

With the threat of tariffs and counter-tariffs between Washington and Beijing looming,Chinese buyers are canceling orders for US soybeans, a trend that could deal a blow to American farmers if it continues.

At the same time, farmers in China are being encouraged to plant more soy, apparently to help offset any shortfall from the United States.

Beijing has included soybeans on a list of $50 billion of US exports on which it has said it would impose 25 percent tariffs if the United States follows through on its threats to impose the same level of tariffs on the same value of Chinese goods. The U.S. tariffs could kick in later this month; China would likely retaliate soon after.

It can take a month or more for soybean shipments to travel from the U.S. to China. Any soybeans on their way to China now could be hit by the tariff by the time they arrive.

"The Chinese aren't willing to buy US soybeans with a 25 percent tax hanging over their head," said Dan Basse, president of AgResource, an agricultural research and advisory firm. "You just don't want the risk."