Germany says U.S.-Europe trade tensions ease, questions remain on soy

By Maximilian Heath

BUENOS AIRES (Reuters) – The trade relationship between the United States and Europe is improving, German Agriculture Minister Julia Kloeckner said on Saturday, but there is no guarantee the bloc will buy the quantity of soybeans that Washington expects.

U.S. President Donald Trump and Jean-Claude Juncker, president of the European Commission, the EU’s executive body, struck a surprise deal on Wednesday that ended the risk of an immediate trade war between the two powers.

After the talks, Trump highlighted benefits for U.S. farmers. “The European Union is going to start, almost immediately, to buy a lot of soybeans,” he told reporters.

Kloeckner, speaking to Reuters on the sidelines of a G20 meeting in Buenos Aires, said the amount of soy Europe will import is yet to be determined.

“Will we be able to do whatever President Trump wishes for? I don’t know. Let’s see whether this will be the case or not,” she said.

The EU was expected to import 15.3 million tonnes of soybeans in the 2018/19 crop year, according to data from the U.S. Department of Agriculture on July 12. The United States is the world’s No. 2 exporter of the oilseed after Brazil.

After Wednesday’s meeting at the White House, Trump agreed to refrain from imposing car tariffs while the European Union and the United States start talks on cutting other trade barriers.

Trump faced a backlash from some U.S. Midwestern farmers and lawmakers after announcing on Tuesday a $12 billion aid package intended as a temporary boost to growers hit by the escalating trade war between the United States and China.

China imposed tariffs of farm products including soybeans after Washington slapped duties on Chinese goods.

“A lot of U.S. farmers are currently under a lot of pressure caused primarily by the reactive tariffs and they are suffering a lot,” Kloeckner said.

“If you keep in mind that a lot of these farmers are supporters of President Trump, they have really felt the pressure. I think this has really helped Trump to understand that these tariffs can be potentially harmful and he has now reined in and we are moving towards a more positive situation,” she said.

Other European officials also expressed relief after Trump and Juncker agreed to tackle their transatlantic trade dispute.

“It’s a good thing for both the EU and the United States to have come together and agree to keep their conversation going, instead of seeing an exacerbation of the trade dispute,” Kloeckner added.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.