US Soybean Farmers Suffer Amid Trade War as Argentina Wins Favor with China

Strategic Insights -

US soybean farmers are struggling as the trade war with China has halted purchases of American soybeans, which previously totaled around $12 billion annually. President Donald Trump has promised to help farmers through subsidies, but plans have been delayed due to the ongoing federal shutdown. Experts warn that subsidies are not a long-term solution and that the US needs to focus on increasing domestic demand and worldwide sales of soybeans to succeed in the market.

Key Takeaways:

  • The US-China trade war has led to a significant decrease in soybean sales from the US, with farmers experiencing a loss of around $12 billion annually.
  • President Trump has promised to provide subsidies to farmers, but the plan has been delayed due to the ongoing federal shutdown.
  • Experts, including Clint Hardy and Caleb Ragland, warn that subsidies are not a sustainable solution and that the US needs to focus on increasing domestic demand and worldwide sales of soybeans.
  • The US opted out of the Trans-Pacific Partnership (TPP), which could have provided opportunities for soybean sales worldwide.
  • Argentina has filled the void left by US soybeans, becoming the largest beneficiary of the trade war, and has received $20 billion in economic support from the US.
  • US soybean prices have decreased, with prices now at around $10.20 per bushel, compared to $12 to $13 per bushel five to six years ago.
  • The imbalance between supply and demand continues to suppress market prices, while all other costs associated with farming continue to climb.

Statistics:

  • The US sells around $12 billion worth of soybeans to China annually.
  • $20 billion in economic support has been extended to Argentina by the US.
  • US soybean prices have decreased from $12 to $13 per bushel five to six years ago to around $10.20 per bushel today.
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  • Argentina dropped its soybean export tax and sold 20 shiploads of soybeans to China in just two days.
  • US farmers are experiencing a gross revenue loss of around $180 per acre.

Sources:

  • "Trump promises aid to American farmers" by The Messenger-Inquirer (Owensboro, Ky.)
  • "US Soybean Farmers Suffer Amid Trade War as Argentina Wins Favor with China" by Tribune Content Agency, LLC