Soya beans may hold the key to world peace

Beijing and Moscow are also seeking to join forces in the production of soya beans. On Monday, Beijing proposed a “soya bean industry alliance” with the two countries planning to co-operate in all areas of the supply chain. Beijing insists this will not interfere with its commitment to raise imports from the US.

Despite the uninspiring data, the talks between US trade representative Robert Lighthizer and his Chinese counterpart were declared a success. China’s commerce ministry said the two sides held a “constructive dialogue” and agreed to continue pushing forward the phase one trade deal’s implementation.

The office of the US trade representative said it had “addressed steps that China has taken to effectuate structural changes”. In what was in practice a campaigning message to Trump’s agricultural base, the press was briefed that China would buy a “record amount” of American soya beans in the second half of 2020 – a statement that sent soya bean futures traded in Chicago to a seven-month high.

The current administration is clinging on to the trade deal as an area of perceived success because it believes this will help with its re-election strategy. The trade talks and phase one deal emphasise the areas where Americans think Mr Trump is more competent than rival Joe Biden – jobs and the economy.

Bashing China on technology transfer and unfair corporate practices will not be as effective as a campaigning strategy because Democrats have roughly similar policies on these issues.

In areas such as human rights, Mr Biden is likely to be much tougher on Beijing. That’s why over the next 10 weeks, we are likely to hear much more about soya beans than semiconductors.

It doesn’t matter that the trade deal is not taken seriously by many economists, the aim is to convince the rural US voters who helped put Mr Trump into the Oval Office in 2016 to turn out and give him a second term. It’s about politics, not trade.

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