Tariffs Leave US Farmers Struggling... Unprecedented Zero Soybean Exports to China

Unprecedented: China Makes Zero Purchases of US Soybeans
US Farmers Say, "No Buyers During Harvest Season"

Major international media outlets have reported that, amid the ongoing US-China trade negotiations, China has completely halted purchases of US soybeans, making the removal of US-imposed tariffs a precondition for any such purchases.

Pods of soybeans turning brown as the harvest season approaches can be seen. Photo by AFP

According to reports from Bloomberg and other foreign media on the 27th (local time), it has been about two weeks since the US soybean harvest season began, yet China has not made a single purchase reservation. Citing data from the US Department of Agriculture, the reports noted that China not reserving any US soybean purchases is unprecedented since records began in 1999.

Traditionally, China has imported newly harvested US soybeans from October through February of the following year, then shifted its sourcing to South American countries such as Brazil after March. However, in recent years, China has been gradually reducing its reliance on US soybeans. Until 2016, US soybeans accounted for about 40% of China’s total imports, but this share has dropped to around 25% since the onset of the trade conflict.

From January to July this year, US soybean exports to China plunged by 51% compared to the same period last year. Industry analysts point out that the higher price of US soybeans due to tariffs is also a significant factor discouraging Chinese purchases.

Chinese importers are significantly increasing their purchases of South American soybeans instead of US soybeans. According to Bloomberg, there have been at least 35 cargo reservations for Argentine soybeans, totaling over 2.27 million tons. This is seen as a clear sign that China is rapidly shifting its sourcing to South America.

The Chinese government has also made it clear that the halt in US soybean purchases is a response to the high US tariff policy. At a regular briefing on the 25th, He Yadong, spokesperson for China’s Ministry of Commerce, stated, "The United States should remove unreasonable tariffs and improve the trade environment between the two countries to help strengthen global economic stability."

This situation is highly likely to directly impact the profitability of US farmers. Some farms are facing severe management difficulties due to a sharp increase in inventories and downward pressure on prices, and there are growing calls for expanded subsidies and other policy responses.