U.S. soybean exports may drop by as much as 20% if the ongoing trade conflict with China is not resolved, according to agribusiness consultancy AgResource. Despite a recently announced temporary truce, analysts argue that the reduced Chinese tariffs—from 145% to 10%—are still too high to make American soybeans competitive in the Chinese market. As China has historically been the largest buyer of U.S. soybeans, the continuation of this dispute poses a significant threat to American agriculture.
U.S. Soybean and Corn Exports Threatened Amid Stalled Trade Deal and Tariffs
Dan Basse, president of AgResource, warned that U.S. soybean exports could fall to 1.5 billion bushels, down from an earlier estimate of 1.865 billion, if no substantial trade agreement is reached. Similarly, corn exports are expected to decline by 13%, dropping to 2.4 billion bushels. Without a timely resolution—ideally by late summer—these projections could become reality, dealing a heavy blow to U.S. farm income. Futures prices would also suffer, with soybean prices potentially dropping to $9 per bushel from the current $10.60.
Trade Deadlock with China Pushes U.S. Soybean Farmers Toward Steep Export DeclineIf a comprehensive trade agreement were to restore tariffs to pre-dispute levels, soybean prices could climb as high as $13 per bushel, according to Basse. However, until then, the market continues to favor other exporting countries. The ongoing tariffs are creating a competitive edge for Brazil and Argentina, which can supply soybeans to China without the same trade barriers. Even a reduced 10% tariff is enough to halt U.S. grain exports to China, further eroding the U.S. position in this key market.
China Favors Brazil as U.S. Farmers Face Rising Pressure and Market Share Loss
China remains the world’s largest importer of soybeans, and in recent years, it has increasingly turned to Brazil for its supply. Brazil currently provides about 70% of China’s soybean imports, benefiting from a record harvest and lower costs. With no tariffs levied on Brazilian soybeans, Chinese buyers have little incentive to turn to the U.S., despite the temporary trade truce. This shift has intensified U.S. farmers’ concerns that they are losing long-term market share.
The uncertainty surrounding the U.S.-China trade relationship is affecting not only soybean exports but also the broader grain market. Basse projected that corn prices could fall to $3.70 per bushel from $4.40, while wheat prices might dip to $4.90 from $5.56. These declines underscore the urgency for a lasting resolution to the trade dispute. Without one, U.S. farmers face mounting financial pressure and increased competition from global producers who are seizing the opportunity created by the trade impasse.
