Agricultural giant since 1983

Chapter 474 Negotiations
At the beginning, the four major grain merchants believed that China could only import soybeans from the United States, but later the Chinese purchasing group won large orders in Ukraine, Russia, Brazil, Argentina and other countries. They restricted this trend, but found that China had already They used the entrepot seaports in Southeast Asia to reserve a large amount of soybeans in advance, and when they ran out of funds to store and consume all the soybeans, thinking that China had no other choice, Kazakhstan popped up again and provided China with a one-time supply 100 million tons of soybeans!
Now they can't hold on anymore. First of all, their funds have been exhausted. Whether it is to continue to input funds or find Goldman Sachs and Morgan Stanley to borrow money, it is not easy; second, the soybean farmers in the United States have also given them money. It's a lot of pressure. It's been a while since the soybeans have been harvested, and they haven't started the acquisition work on a large scale. If they don't start, there will definitely be problems.

The most important thing is that Kazakhstan is located in the deepest part of the Eurasian continent. Europe and the United States are extremely weak in intervening in this country. Kazakhstan attaches the most importance to Russia in diplomacy, followed by China, and then the turn of Europe and the United States. The four major grain merchants did not The way is to interfere with the soybean export of this country like controlling South America.

Moreover, Kazakhstan has agricultural potential that ranks among the top in the world. One million tons of soybeans is far from their limit. The share in the global market will be further reduced.

"No wonder they chose to make concessions in soybeans and other fields when they were negotiating WTO accession. It turned out that they had been prepared for a long time, but we were too arrogant and underestimated them!" It will launch an offensive in the soybean field, so it began to lay out several years ago.

In fact, most of these are the credit of Li Lei, and for this battle, he started preparations as early as ten years ago. When he first entered the Kazakhstan market, he persuaded Nazarbayev to start the northern The Soybean Planting Program provides assistance to Kazakh farmers in areas suitable for planting soybeans in terms of financing, technology, seeds, and agricultural machinery, and encourages them to plant soybeans.

More than ten years of persistence has made this plan fruitful. Today, Kazakhstan’s soybean planting area has expanded to 150 million hectares, and its total output has increased to more than 300 million tons. As a country with a population of only 500 million, Kazakhstan Stan himself certainly cannot digest so many soybeans, and they can spare more than 200 million tons of soybeans for export to China every year.

This amount is by no means too much for China in the future, but at the moment, it is enough to determine the outcome of this war, and it played the role of the last straw that crushed the four major grain merchants, making them lose The only hope of winning is to seek peace from Li Lei and the others and initiate negotiations.

"I finally won!" When the news came, the leaders of China Grain Storage, COFCO and other institutions also let out a sigh of relief, and quickly wiped off the cold sweat on their foreheads. They have also been under tremendous pressure during this period, and the four major grain merchants can't stand it anymore , In fact, they are almost on the verge of collapse.

The 100 million tons of soybeans sold out by Sinograin at the end were actually naked orders. They no longer have so many soybeans in their warehouses, and the train in Kazakhstan was not all soybeans, most of them were wheat. They were just playing In ancient wars, it was just a routine of using sand to pretend to be military rations to boost morale. Fortunately, the four major grain merchants admit their defeat, or they would be the ones who collapsed.

"It's too risky! It's just so close. If the four major grain merchants still have the money to take our orders, then we will really lose!" Mr. Gao still has lingering fears. If such a thing really happens, the It's not yet known how many people in the office are about to throw their hats.

"So sometimes you have to grit your teeth and persevere when you encounter things! In fact, life is not easy for the four major grain merchants. They have been reluctant to start buying soybeans for a long time. American farmers are about to fall out. If this continues, Maybe we really don’t need to buy soybeans from them this year. If we don’t buy soybeans this year, we definitely won’t buy them in the future. They can’t bear the responsibility of losing the world’s largest customer, and they can’t explain it to shareholders! So they admit it It has become inevitable!" Li Lei said in relief.

"Then the next step is to negotiate! It is foreseeable that they will continue to put on airs at the negotiating table, put pressure on us, and force us to agree with various harsh conditions! At this time, we must remember that our predecessors The sentence that Panmunjom said - 'What you can't get on the battlefield, you can't get on the negotiating table', since we won this battle, they have to listen to us!"

Then everyone seriously discussed several principles that our side should adhere to. We must sign a long-term agreement to finalize the total amount and price of soybeans they will supply to us in the next few years; we must conduct diversified procurement, and we cannot hand over all orders to the Big Four. Grain merchants, Brazil, Argentina, Kazakhstan and other soybean exporting countries must also have a certain share, etc. In short, it means to maintain the safety of soybean imports and hold the pricing power in their own hands.

The four major grain merchants seem to be very anxious. They are hoarding a large amount of soybeans and are eager to sell them to China as soon as possible. Even many soybeans bought from China Grain Storage have no place to store them. Once these soybeans are damaged due to improper storage , then all their money will be wasted.

So after receiving Li Lei's reply, the four major grain merchants quickly sent representatives to negotiate. Just as Li Lei expected, they were still aggressive at the negotiating table and offered one after another that the Chinese side would absolutely not accept. Conditions, such as abandoning the procurement contracts signed with Brazil and other countries, all soybeans will have to be purchased from them in the future, and another example is to purchase their soybeans at a high price of 3500 yuan per ton, and even not allowing China to invest in foreign soybean industries Such conditions have been released.

Li Lei got up and left before he finished listening, "Since you haven't woken up yet, don't talk about it, go back and have a good sleep, and talk about it when you wake up from the dream!"

"As long as you have a plate of peanuts, you can't drink like this! Since you have this attitude, let's go to Brazil, Mr. Li! You are not the only one who has soybeans!" COFCO's Mr. Gao also got up, and then the COFCO waited The representatives of the organization stood up at the same time. The negotiation had just started, and the Chinese representatives left completely.

The four major grain merchants originally wanted to bluff to see if they could find a bargain, but they did not expect the Chinese side to respond so decisively. They could not help but raise the estimated data of China's total soybean storage. If there is not enough storage , They must not dare to do this, right?

The first negotiation ended before it started, and the Chinese side did not contact them again after returning home. In the end, the representatives of the four major grain merchants took the initiative to call and invite them to conduct the second negotiation. The big grain merchants are even more anxious.

Now the soybeans that have no place to store at the wharf have shown a small amount of deterioration, which is equivalent to setting the money on fire, and the longer they wait, the more they burn. Abandoning this batch of soybeans, they have done a lot of things like this before, and now these batches of soybeans are all on Chinese soil. Isn't it easy for the Chinese to destroy them?So let's continue negotiating.

The conditions they gave in the second negotiation were much looser than the previous one. Li Lei and others also set out their own conditions, which were discussed in the previous meeting, signing a long-term agreement, stabilizing the purchase price of soybeans, and not Handing over all orders to them can give them the largest share, because after all, they hold the most soybeans in the world, and they can even cooperate in the import of other crops such as corn, but they must not be allowed to monopolize this business. Otherwise, they would definitely tear up the contract without hesitation and launch a second attack.

This time the negotiation was much more fruitful than the previous one. At least both parties understood each other’s needs. Then they had a fierce quarrel over each specific item. Because the differences were too large, they could not reach an agreement in the end, but both sides felt that Negotiations are useful and can continue.

After returning home, they hold meetings and discuss to see which links can be slightly compromised, which must be insisted on, and what the situation of the other party can force them to make concessions in those areas, so as to strive for more benefits for themselves. Hold meetings outside, and continue the meeting when you come back Late at night, and then go to quarrel with the opponent the next day. In the past few days, the people in charge of both sides have been very busy.

The debate continued in the meeting room, and they were not idle outside the meeting room. The purchasing group continued to buy soybeans in South America. While they were meeting, several freighters came back from South America full of soybeans. When they were in Shanghai, Qingdao, Ningbo, etc. When the news of the port docking came, the four major grain merchants became even more passive.

Before, all the soybeans purchased overseas were shipped to Dalian Port because the futures market is here, which can give speculators a more intuitive shock. Now Huinong, COFCO, and Sinograin have won the futures market, and the price of soybean futures has been killed by them. If you hold it down, you don't have to do it anymore.

It is more cost-effective to transport soybeans directly to where they are needed. The soybeans in Qingdao Port are used by Luhua. There are also many oil extraction companies in Shanghai and Ningbo. Most of these companies have joined the China Grain and Oil Enterprises Association. The association is obliged to provide them with raw materials. After this batch of soybeans arrived in Hong Kong, domestic oil extraction companies felt much more at ease, even those who have not yet queued up for the time being are not worried, even if it is not their turn to get soybeans for this ship, there are still several ships at sea We're almost at port, and I'm sure the next one will be my turn.

Faced with such a situation, the four major grain merchants once again made concessions. They agreed to sell soybeans to China at a lower price, which was even lower than the transaction price when they received the selling order from China Grain Storage. The soybeans shipped from the United States are still profitable. There is no way that the conditions for agricultural development in the United States are too good. The cost of this batch of soybeans traveling across the ocean to China is still much lower than that of domestic soybeans.

But in terms of the specific share, they still insist that they can recognize the orders signed by China and other countries, but only those signed before today. From now on, no new orders can be added. They can supply the soybeans China needs in full Provided, the price will follow the current market.

As long as China can become dependent on their soybeans, even if they lose money this time, there is no need to worry, and the next time there is a chance to raise the price to make it back; at that time, if China wants to buy soybeans from other places, it will not be as it is now. Easy, they will definitely try to stop it.

Li Lei firmly disagrees. We can give you [-]% of the share, and there will be no more. The remaining orders will be given to Brazil, Argentina, Kazakhstan and other countries. These countries have provided us with much-needed soybeans and should give us They return more, otherwise who would be willing to stand by their side next time?

The two sides reached a stalemate for a while, but under the influence of time, they each took a step back. The four major grain merchants agreed to sign a five-year long-term supply agreement, and agreed on price fluctuations, and then renegotiated before the agreement expired. The next stage of cooperation.

Li Lei and the others have also increased the share of soybeans imported from the four major grain merchants from [-]% to [-]%. Brazil and other countries can basically guarantee safety by sharing [-]% of soybeans. What's more, they are only talking about China's import quota. Li Lei and COFCO Companies can still invest in soybean farms in Brazil and other countries. At worst, they sell excess soybeans to other countries, or process them into soybean oil and soybean meal in their own countries and then export them to China. This agreement only talks about soybeans, but not soybean oil and soybean meal. The soybean meal thing.

Moreover, Li Lei’s ranch in Brazil will also consume a large amount of soybean meal. In the future, he plans to buy pastures in Brazil, Argentina, New Zealand and other countries to raise beef cattle and dairy cows to provide more beef and milk for the country. There are more demands, so don't worry about having no place to digest them.

As long as you can control enough soybeans, the four major grain merchants will still be unable to control China’s soybean industry in five years’ time. By then, China’s planting area of ​​saline-alkali-resistant soybeans will definitely increase, and the strategic reserve of oil crops for Sinograin will also be available. Now, it will be much more calm to deal with the current attack.

After going through extremely torturous negotiations, the two parties finally reached an agreement, and then the four major grain merchants couldn't wait to sell them the soybeans they bought from China Grain Storage. After coming and going, Li Lei and China Grain Storage did not reduce their inventory, but Having made a lot of extra money, COFCO also made a lot of money in the futures market.

As soon as so many soybeans were released, most oil extraction companies were not in a hurry, and basically got the soybeans needed for production. At the same time, cargo ships full of soybeans also set off from American ports to China. The second soybean crisis was satisfactorily resolved.

"Now that I have money, I can finally build more special storage warehouses for oil crops, and build our country's strategic oil crop reserves!" The leader of China Grain Storage said with a smile.

(End of this chapter)