A recent economic study commissioned by the American Soybean Association (ASA) and the National Corn Growers Association (NCGA) highlights the potential negative consequences of a renewed U.S./China trade war on American farmers and rural communities. The study, conducted by the World Agricultural Economic and Environmental Services, reveals that American-imposed tariffs could significantly harm U.S. producers while benefiting competitors like Brazil and Argentina. The study predicts an immediate and substantial drop in corn and soybean exports to China if a new trade war were to occur. Specifically: Soybean exports to China could fall by 14 MMT to 16 MMT annually, representing a 51.8% average decline from expected baseline levels. Corn exports to China could decrease by about 2.2 MMT annually, an 84.3% average decline from baseline expectations. The potential trade war would lead to a steep drop in soy and corn prices, causing a ripple effect across rural economies where farmers live, purchase inputs, use services, and buy household goods. Leaders at NCGA and ASA believe maintaining a trading relationship with China is in America’s economic interests, even as both governments work through trade and other concerns. The research underscores the importance of thoughtful consideration regarding the impacts of tariffs and tariff retaliation on U.S. farms and rural communities, as the potential consequences could be far-reaching and long-lasting.
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