World

Beyond Tariffs: How China’s Soybean Boycott Squeezes U.S. Farmers and Reshapes Global Trade

China halts U.S. soybean buys due to trade war, harming farmers & forcing them to seek smaller markets.

October 3, 2025, 12:38 PM

Farmer examining rows of soybean plants in a field during daytime

A farmer wearing a red cap and brown t-shirt walks through a lush green soybean field, inspecting the crop. By Fotokostic / Shutterstock.com.

Executive Summary

For the first time in over two decades, Chinese importers have ceased purchasing U.S. soybeans from the autumn harvest due to trade war tariffs, making American supplies too costly.

This halt has inflicted severe financial hardship on U.S. farmers and agricultural businesses, causing significant drops in exports and forcing farmers to store crops at low prices.

While the U.S. is pursuing alternative, albeit smaller, export markets, these cannot effectively replace China, which historically imported the majority of the world’s traded soybean supplies.

The Story So Far

The current cessation of Chinese purchases of U.S. soybeans stems from an escalating trade war between the two nations, which led China to impose a 23% tariff on American soybean shipments. This tariff has rendered U.S. soybeans uncompetitive, compelling Chinese importers to shift their business to South American suppliers and creating severe financial hardship for U.S. farmers due to China’s historical position as the world’s largest soybean importer.

Why This Matters

The unprecedented halt in Chinese soybean purchases, a direct result of escalating trade tariffs, is inflicting severe financial hardship on U.S. farmers and agricultural businesses, causing significant losses and a substantial downturn in exports. This disruption is fundamentally reshaping global soybean trade, as China shifts its demand to South American suppliers, while U.S. efforts to secure smaller alternative markets are proving insufficient to offset the immense void left by China’s historically dominant demand.

Who Thinks What?

U.S. farmers and the agricultural industry view the cessation of Chinese soybean purchases as inflicting severe financial hardship, leading to significant losses, stored crops, and “overwhelming frustration” for growers and related businesses.

President Trump attributes China’s halt in soybean purchases to “negotiating reasons” and indicates that soybeans will be a key discussion point in upcoming talks, while the U.S. administration actively seeks alternative, though smaller, export markets and plans support for affected farmers.

Chinese importers have ceased purchasing U.S. soybeans from the autumn harvest because the 23% tariff makes American supplies too costly, leading them to shift their purchases to South American suppliers like Brazil and Argentina.

For the first time in over two decades, Chinese importers have ceased purchasing soybeans from the autumn U.S. harvest, a direct consequence of an escalating trade war that has made American supplies too costly. This unprecedented halt in sales is inflicting severe financial hardship on U.S. farmers, particularly in major producing states like Illinois, and is forcing the industry to seek alternative, albeit significantly smaller, markets globally.

Economic Fallout for U.S. Agriculture

The absence of China, historically the world’s largest soybean importer, has led to a significant downturn in U.S. agricultural exports. From January to July, before the autumn harvest began, U.S. soybean exports to China dropped 39% by volume to 5.9 million metric tons and 51% by value to $2.5 billion, according to government data.

Farmers are now storing much of their crops, hoping for future price increases from around a five-year low. This delay in sales impacts their ability to generate income while facing rising operational costs. In Illinois, growers are reportedly facing losses of up to $8 per acre due to low prices and weak exports.

The financial strain extends beyond farms to agricultural businesses. Equipment manufacturer CNH, which sells tractors and combines, reported a 20% drop in net sales for its agriculture business in the first six months of the year compared to the previous year. The mayor of Decatur, Illinois, once known as the “soy capital of the world,” suggested that title might now belong to Brazil.

Tariffs Drive Market Shift

The core issue stems from tit-for-tat tariffs imposed by Washington and Beijing. China’s 23% tariff on U.S. soybean shipments adds approximately $2 a bushel to the cost for importers, making American soybeans uncompetitive. As a result, Chinese buyers have shifted their purchases to South American suppliers like Brazil and Argentina.

President Trump has acknowledged the impact, stating on Truth Social that “The Soybean Farmers of our Country are being hurt because China is, for ‘negotiating’ reasons only, not buying.” He indicated that soybeans would be a key discussion point in upcoming talks with Chinese President Xi Jinping. U.S. Treasury Secretary Scott Bessent also announced that the government would make an announcement regarding support for farmers.

Seeking Alternative Markets

In response to the market disruption, the U.S. administration and industry groups are actively pursuing new export opportunities. Trade missions have been conducted to countries such as Nigeria, Vietnam, Turkey, and Saudi Arabia, with memorandums of understanding signed with nations like Vietnam for over $1.4 billion in U.S. farm products, including soybeans.

However, these alternative markets are comparatively small. For instance, a significant increase in exports to Bangladesh amounted to just over 400,000 tonnes, a fraction of China’s typical demand. Despite rising shipments to Vietnam, Egypt, Thailand, and Malaysia, total U.S. soybean exports were down 8% by volume from the same period a year ago.

U.S. Agriculture Secretary Brooke Rollins stated on social media that Taiwan committed to $10 billion in U.S. agriculture purchases over the next four years. However, the article notes this commitment would not represent an increase, as U.S. agricultural exports to Taiwan in a recent year totaled $3.8 billion, which would amount to $15 billion over four years at that pace.

The Challenge of Replacing China

Replacing China as a soybean buyer presents a formidable challenge. With over 1.4 billion people and the world’s largest hog herd, China has historically imported an average of 61% of the world’s traded soybean supplies over the past five years, more than the rest of the world combined. In a recent year, U.S. exports to China reached nearly 27 million metric tons, compared to 5 million metric tons to Mexico, the second-largest buyer.

Farmers remain hopeful that current efforts to diversify markets will yield long-term benefits, but the immediate struggles are profound. Caleb Ragland, a Kentucky farmer and president of the American Soybean Association, described the situation as “overwhelming frustration.”