Global soybean market reshaped by trade tensions

陈小将

As one of the most cultivated crops on earth, the majority of the soft, protein-packed little soybeans that are grown in countries worldwide are not for human consumption but are used to feed livestock such as hogs, cattle and chickens.

China is the largest soybean importer in the world as it uses most of the high-protein feed for its enormous population of hogs, according to the American Soybean Association.

But this year, the international soybean market has been reshaped, at least temporarily, by several factors, mainly the impact of the US-initiated trade conflicts with China, which led to reduced US soybean exports to the Chinese market as Beijing increased purchases from Latin America, analysts said.

"It created a reshuffling and we were seeing Brazil and Argentina positioned to take advantage of it and unfortunately that was hurting US farmers," Lia Nogueira, associate professor in the Department of Agricultural Economics at the University of Nebraska-Lincoln, told China Daily.

Argentina's announcement in late September to temporarily eliminate export taxes on agricultural products, including soybeans, worsened the situation, as the move made its soybeans more price-competitive, dealing another blow to US soybean farmers and traders.

Starting in May this year, working teams from both China and the US have held five rounds of economic and trade talks in several countries, including the latest one in Kuala Lumpur late last month.

Washington announced on Oct 30 that China had agreed to buy US soybeans through January in a welcome reprieve for struggling US farmers. China's Ministry of Commerce said the two sides reached consensus on the expansion of agricultural products after the Kuala Lumpur talks.

In 2024, Brazil alone accounted for more than 70 percent of China's total imports of soybeans, followed by the United States, with a proportion of more than 20 percent. Other major soybean-exporting countries include Argentina, Russia, Canada and Uruguay.

Attempting to boost domestic production and "Make America Great Again", the US administration has imposed steep tariffs on various imports. But the policy may backfire, affecting the interests of its domestic industries, analysts said.

"Historically, tariffs … as trade barriers … can cause domestic industries to become less competitive and lead other countries to retaliate," Thomas Fullerton, a US economist and economics professor at the University of Texas at El Paso, told China Daily.