United States soybean exports could drop as much as 65%, if the back-and-forth trade rhetoric battle between the two largest economies causes China to slap on retaliatory tariffs.
Politico says this number comes from a soon-to-be-published report out of Purdue University.
China earlier this month said it will put a 25% tariff on U.S. soybeans, if President Trump follows through on his plan to punish China for forced technology transfers by implementing American tariffs on Chinese goods. If the trade war actually happens and tariffs are put in place, China will rely on Brazil soybeans to fill in the gap. Brazil is currently the largest soybean exporter to China.
United States soybean farmers likely could find some substitute business by expanding into other markets that currently import Brazilian beans. Wally Tyner, professor of ag economics at Purdue, says, “Brazil will take a big chunk of our market with China, and we’ll take a chunk of Brazil’s business in other countries.” However, increasing exports to other countries like the European Union, Mexico, Indonesia, and Japan, still won’t make up for a major loss of business with China, worth nearly $14 billion.