ST. LOUIS — The past year has been the most challenging in a generation, U.S. soybean growers say, thanks to the trade war with China.
July 6 was the one-year mark of 25% tariffs placed on U.S. beans exported to China. The subsequent trade war has left prices lower and anxieties much higher for farmers, said Davie Stephens, president of the American Soybean Association.
Before the trade war, U.S. soybean farmers saw prices well over $10 per bushel. But recently that number has been in the $8 range “way too often,” Stephens said.
Farmers, though, are taking hope in reports of continued talks between the U.S. and China. President Donald Trump and Chinese President Xi Jinping agreed at the G-20 summit to reconvene negotiations that stalemated in May.
It’s a positive sign, but Stephens said the only thing that will help their industry is an agreement between both countries to rescind the tariffs.
The U.S. Soybean Export Council reports that shipments of U.S. beans to China were down 19.2 million metric tons, or 705.2 million bushels, in the first 10 months of the current marketing year compared to the 2017-18 marketing year.
As the China market continues to erode, opportunities increase for other soy-producing countries to steal U.S. market share.
That lost market opportunity, along with a significant drop in the price of soybeans, has led to a historic carry-over stock of unsold American beans. USDA’s National Agricultural Statistics Service reported stored soybeans up 47% for June year-over-year.
By far the largest market traditionally for U.S. soybean exports, China continues to promise good-faith purchases of American beans. But the industry that built a strong market in China wants to see free trade restored rather than filling the gap with government-to-government purchases while negotiations continue indefinitely.
Stephens said any movement of U.S. beans to China is better than none, but the long-term answer for viability of the industry is reopening the door to trade by rescinding the tariffs.
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