Trade thaw, tempered hopes: China’s soybean pledge offers relief but no full fix for US farmers

American farmers have welcomed China’s pledge to purchase US soybeans, but many say it will not be enough to offset the broader challenges they face, including rising costs for fertiliser, tractors, seeds and repair parts.

Under the new arrangement, China has promised to buy at least 25 million metric tons of soybeans annually over the next three years, restoring purchase levels to what they were before President Donald Trump initiated a trade war with Beijing. However, the 12 million metric tons China plans to import between now and January is still only about half of the usual annual volume.

“This is a very good thing. I’m very grateful,” said Robb Ewoldt, an Iowa farmer and director with the United Soybean Board. “I don’t want to sound like an ungrateful farmer, but it doesn’t cure everything in the short term.”

US Agriculture Secretary Brooke Rollins said China has also agreed to lift all retaliatory tariffs on American agricultural products, which could help boost sales of other crops and beef. Additionally, Beijing has pledged to resume purchases of US sorghum, a crop mainly used for animal feed and heavily dependent on the Chinese market. More than half of the US soybean and sorghum harvests are typically exported, much of it to China.

Farmers say these commitments could make it easier to secure loans for the upcoming planting season. Still, Ewoldt cautioned, “I hope the administration doesn’t think that this solves everything in the next six to ten months.”

Trump had earlier announced plans for a financial aid package to support farmers affected by the trade war, but the rollout has been delayed due to the ongoing government shutdown. Rollins said the assistance remains under consideration and assured that the administration would “step in the gap” if needed.

“We’ll see what the market does, and we will be ready to continue to step in if we believe it’s necessary,” Rollins said.

China is the world’s largest buyer of soybeans. It had been consistently buying about one quarter of the American crop in recent years. China bought more than $12.5 billion worth of the nearly $24.5 billion worth of U.S. soybeans that were exported last year.

China quit buying American soybeans this year after Trump imposed his tariffs. Yet it had been steadily shifting more of its purchases over to Brazil and other South American nations ever since Trump’s initial trade war with China in his first term.

Last year, Brazilian beans accounted for more than 70% of China’s imports, while the U.S. share fell to 21%, World Bank data shows. Argentina and other South American countries also are selling more to China, which has diversified to boost food security.

Farmer Caleb Ragland, who is president of the American Soybean Association trade group, said this agreement lays the foundation for restoring China’s traditional purchases of 25 million to 30 million metric tons of American soybeans.

“This is a meaningful step forward to reestablishing a stable, long-term trading relationship that delivers results for farm families and future generations,” said Ragland, who farms near Magnolia, Kentucky.

Indiana farmer Brent Bible said this deal with China sounds good— as long as they actually do what they promised, unlike what happened with the trade agreement China signed with the United States in 2020 after Trump’s initial trade war. The COVID-19 pandemic disrupted trade between the two nations just as the agreement went into effect. In 2022, U.S. farm exports to China hit a record, but then fell.

“If we see actionable purchases and follow through by China, then it’s great,” Bible said.

With inputs from agencies