Commodities

China sees intensive contact ahead of next trade talks; small U.S. soybean sales reported

Credit: REUTERS/POOL

U.S. and Chinese negotiating teams will be in intensive contact to prepare "good groundwork" for trade talks in September, the commerce ministry said on Thursday, as Washington confirmed China's first private purchase of soybeans since a tariff war broke out more than a year ago.

By Stella Qiu and David Lawder

BEIJING/WASHINGTON, Aug 1 (Reuters) - U.S. and Chinese negotiating teams will be in intensive contact to prepare "good groundwork" for trade talks in September, the commerce ministry said on Thursday, as Washington confirmed China's first private purchase of soybeans since a tariff war broke out more than a year ago.

Senior officials from the world's two largest economies ended two days of talks in Shanghai on Wednesday with little sign of progress apart from agreeing to meet again next month.

It was their first in-person talks since presidents Donald Trump and Xi Jinping agreed to a trade ceasefire at a G20 summit in June.

The United States and China have levied billions of dollars of tariffs on each other's goods in a year-long trade war, disrupting global supply chains and roiling financial markets.

Talks between the two sides broke down in May after U.S. officials accused China of pulling back from earlier commitments. Washington sharply hiked tariffs on $200 billion worth of Chinese goods and Beijing retaliated, escalating the trade dispute.

"With regards to this (week's) round of negotiations, both sides communicated over two topics: One is how we view the past - we mainly discussed why negotiations broke down and clarified our views on some economic and trade issues," commerce ministry spokesman Gao Feng told reporters at a regular briefing.

"The other one is how we view the future to ascertain the principles and methodology of negotiations, as well as relevant timetables."

China and the United States can resolve their differences if both sides' concerns are taken into consideration, Gao said, reiterating past comments from Beijing.

SOYBEANS AND HUAWEI

White House trade adviser Peter Navarro told CNBC that U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin would brief Trump administration officials on Thursday.

Two people familiar with the Shanghai talks said they focused largely on goodwill gestures including Chinese purchases of U.S. soybeans, pork, ethanol and other commodities, and U.S. moves to relax restrictions on sales to Chinese telecommunications giant Huawei.

The month until the next meeting gives both sides time to take action on these commitments, the Washington-based sources said..

The U.S. Department of Agriculture on Thursday confirmed private sales to China of 68,000 tonnes of soybeans in the week ended July 25.

The sale was the first to a private buyer since Beijing offered to exempt five crushers from the 25% import tariffs imposed more than a year ago as part of the trade dispute. A government buyer purchased 544,000 tonnes of soybeans in late June.

The purchases represent just a small fraction of the 87 million tonnes of soybeans that China is expected to import over the 2019/20 marketing year.

Beijing has offered to exempt five domestic soybean crushers from the import tariffs on U.S. beans, which has driven Chinese buyers to turn to Brazil and Argentina for supplies.

(Reporting by Stella Qiu and Beijing Monitoring Desk; additional reporting by David Lawder in Washington and Mark Weinraub and Karl Plume in Chicago Editing by Sonya Hepinstall)

((LushaZhang1@thomsonreuters.com; 8610-66271276;))

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