Taiwanese trade officials in town this week signed letters of intent to buy up to $2.49 billion in corn and soybeans from Minnesota and other Midwest states.
They’re committing to buy almost the same amount of the commodities as they’d agreed to in the past, but prices have dropped considerably.
The new agreement, signed by the Taiwanese delegation led by the Deputy Minister of the Taiwan Council of Agriculture, is for planned purchases in 2016-2017 of:
- 197 million bushels of U.S. corn and 500,000 metric tons of dried distillers grains valued at an estimated $1.23 billion
- Between 96 million and 107 million bushels of U.S. soybeans valued at an estimated $1.26 billion
About $250 million of this would come from Minnesota crops.
Two years, ago, the Taiwanese signed an agreement calling for purchases in 2014-2015 of:
- 197 million bushels of U.S. corn and 500,000 metric tons of dried distillers grains valued at an estimated $1.83 billion
- Between 92 million and 99 million bushels of U.S. soybeans valued at an estimated $1.68 billion
Corn prices in 2013 were in the $7 per bushel range; now they’re below $4. Soybean prices were in the $14 range then and under $10 now.
According to Minnesota Department of Agriculture economist Su Ye, by mid-2015, Taiwan has fulfilled approximately 70% of its purchase obligations for corn and 90% for soybeans for the biennium 2014-2015, with six months still remaining.
Taiwan is Minnesota’s sixth largest export partner.