Jul 06, 2018
A soft farm market, already-declining prices, and now, China’s retaliation against President Trump’s 25 percent tariffs on $34 billion worth of Chinese goods, which took effect at midnight last night. Soybean farmers, whose crop represents 41 percent of the value of products on China’s tariff list, will feel the full effect.
The value of U.S. soybean exports to China has grown 26-fold in 10 years, from $414 million in 1996 to $14 billion in 2017. Since talk of the tariffs began back in March, U.S. soy prices have dropped more than $2.00 per bushel.
“Soybeans are the top agriculture export for the United States, and China is the top market for purchasing those exports,” said John Heisdorffer, a soybean grower from Keota, Iowa, and president of the American Soybean Association (ASA). “The math is simple. You tax soybean exports at 25-percent, and you have serious damage to U.S. farmers.”
Soy growers rely heavily on exports to China: In 2017, China imported 31 percent of U.S. production, equal to 60 percent of total U.S exports and nearly 1 in every 3 rows of harvested beans. Over the next 10 years, Chinese demand for soybeans is expected to account for most of the growth in global soybean trade, which underscores the importance of this market for future U.S. soybean sales.
When the possibility of tariffs first arose, ASA asked President Trump to consider other policies for reducing the U.S. trade deficit with China. Then ASA organized a fly-in to urge Congress to encourage the Administration to rethink the tariffs. Finally, in a last-ditch social media effort earlier this week, individual soybean farmers who will be directly affected by the trade conflict attached their photographs to statements appealing directly to the President and his advisors.