Farmers feel betrayed as China dangles millions of tons of soybean purchases from the United States to gain an advantage in the escalating trade war.
Soybean farmers, caught in the middle of a trade war between the world’s two biggest superpowers, are starting to feel the consequences as China uses its purchasing power as political leverage.
As China’s economy has improved, the country has sought more growth-boosting, protein-rich soybeans to feed its growing number of livestock, such as pork and poultry. As the world’s largest buyer of soybeans, China purchased $12.6 billion worth of soybeans from the United States last year, accounting for more than half of total U.S. exports of the crop, which is its largest agricultural export.
Yet this year, the Trump administration’s trade war with China has changed its soybean strategy.
The world’s second-largest economy typically commits to buying U.S. soybeans as early as September, at the start of the fall harvest. However, thanks in part to tensions with the United States and increased tariffs, China did not commit, from May to the end of October, to buying American soybeans, relying in part on South American imports, notably from Brazil.
In recent years, China has also expanded its own soybean production, adding about 9 million acres of cultivation and increasing production by 8.6 million tons since 2015, according to the University of Arkansas Division of Agriculture.
As a result, American farmers faced undue pressure. Caleb Ragland, a ninth-generation Kentucky farmer and president of the American Soybean Association, told a congressional hearing in October that the price of agricultural production, including the cost of land, seed and fertilizer, has skyrocketed while farm margins continue to decline.
“For soybean farmers, the loss of our largest export market due to China’s trade retaliation has further compounded financial problems,” Ragland said. “High production costs and market losses mean soybean growers are expected to face a loss of approximately $109 per acre for this year’s crop.”
China ultimately committed to buying 12 million tons of soybeans, up from 22.5 million tons the previous season, ahead of President Donald Trump’s meeting with Chinese President Xi Jinping in South Korea late last month.
Trump also promised $12 billion in aid to affected soybean farmers, who as a group were one of his strongest supporters when he returned to the White House last year.
Still, some farmers, like Scott Gaffner, executive director of the Illinois Soybean Association, say President Trump’s bailout isn’t enough.
While China has committed to buying 25 million tons of soybeans over the next three years, U.S. soybeans still face a 13% import tariff imposed by China, making it less attractive than competing supply from South America. In recent years, China has started to shift its purchases to Brazil. China will import 71% of its soybeans from Brazil in 2024, up from 2% in the late 1990s, according to the U.S. Department of Agriculture.
Gaffner said any further changes in China’s soybean purchasing habits could cause problems for farmers in the years to come.
“If China starts buying elsewhere, which it is doing now, once it establishes these trade routes, it will become more difficult for it to come back to the United States and buy its products,” Gaffner said. CBS. “Once we lose it, we may never get it back. And that’s huge.”
