The U.S. soybean crop seems to be getting smaller. Drier weather has set in across much of the Midwest, which could taper soybean yields. Disease pressure is also starting to mount. But even with the potential for the soybean crop estimates to shrink, analysts warn without China coming to the table, soybean prices could be stuck in this low price pattern.
The relationship between the U.S. and China looked to be on ucertain terms this week. President Trump posted on his Truth Social site on Tuesday and accused Russian President Vladimir Putin, Chinese President Xi Jinping and North Korean leader Kim Jong Un of conspiring against the U.S. The post was spurred by teh three world leaders meeting in Beijing during a military parade.
“The big question to be answered is whether or not President Xi of China will mention the massive amount of support and ‘blood’ that The United States of America gave to China in order to help it to secure its FREEDOM from a very unfriendly foreign invader,” Trump posted on Truth Social.
It was just last month Trump urged China to step up its purchasing, posting on his Truth Social social media site.
“China is worried about its shortage of soybeans,” Trump wrote. “I hope China will quickly quadruple its soybean orders. This is also a way of substantially reducing China’s Trade Deficit with the USA.”
That single post caused soybean prices to surge more than 2%, proof that if China would come to the table to buy, soybean prices could surge almost overnight.
Sub $9 Soybeans for Some Farmers
Even with Washington and Beijing extending a tariff truce for 90 days earlier this month, China hasn’t officially purchased a single bushel of new crop U.S. soybeans, something the U.S. hasn’t seen since 2010.
As AgWeb reported last week, soybean prices are falling well below break-even levels for farmers, but when you look at cash prices in the northern Plains, prices are catastrophically low. As of last week, farmers near Maddock, N.D. were experiencing a basis that was negative $1.65, with cash soybeans sitting at $8.83.
At prices below $9 for some U.S. farmers, they’re looking at losing even more equity this year. The American Soybean Association sent a letter to President Donald Trump last month warning of dire long-term economic outcomes for farmers if the country continues to not buy U.S. soybeans.
But is China the only hope to revive soybean prices?
“Unfortunately, so,” says Jim McCormick with AgMarket.net. “I mean, you’re going to see a little bit of a shift. If Brazil is going to feed that China market, they’ll have less beans to sell in the world market, and that will give us some opportunity. But the fact of the matter is, I just don’t think there’s enough additional demand to meet that just monster consumption from China. So it’s a huge concern.”
That concern is growing, as AgResource Company’s Dan Basse says Chinese importers are being instructed by their government to not buy U.S. soybeans.
“I cannot find China buying soybeans today,” Basse told “U.S. Farm Report” late last week. “I cannot find any evidence of anything changing. Secretary of Treasury Bessent indicated the negotiations with China are working well. Soybeans will be included in the final pact, which I think we all expected. But although the talk of China buying U.S. beans was evident today, I can’t find it in any of my commercial clients that they’ve made any sales.”
Basse says soybean importers aren’t just snubbing U.S. soybeans. They are specifically being told by the Chinese government to not buy U.S. beans.
“So, if you’re a Chinese importer or a Chinese crusher, you’ve been told by the government not to buy U.S. soybeans until they tell you to,” Basse says. “This is how China works. Today the Chinese have a stronghold on buying United States soybeans, even though our prices are nearly $1 a bushel cheaper than what they’re buying in Brazil. This is the pressure that I believe the Chinese government is trying to apply on the Trump administration during a trade negotiation.”
China seems to be intentional about its purchasing, opting to buy from Brazil instead of the U.S, a sign farmers may once again be the bargaining chip in the latest trade war.
