Soybean flows are changing, but who reaps the rewards?
- rorykevinproud
- May 29
- 3 min read
29 May 2025 Signal
On the whole, soybean export volumes in 2025 do not look dissimilar to those of recent years. As a result, it would be easy to assume that nothing in the market has changed.
However, a deeper look into the market shows some compelling changes in trade flows. The major change has come from lower exports of soybean products from the U.S., which first started to decline during the 2018-19 marketing year. Figures from the Food and Water Watch (FWW) show that farm bankruptcies surged 24% that year, as Trump’s first-term trade policies led the U.S.’s largest soybean export market, China, to hit back with a 25% tariff on soybeans. This tariff rose further in 2019 to 35% as the trade war intensified, before some allowances were made on quantities of soybeans.
Since Donald Trump’s re-inauguration in January 2025, tariffs have been used broadly by the U.S. government, with retaliatory tariffs issued back. As a result, all imports from the U.S. into China received a 125% tariff at the beginning of April. The spike in soybean product exports in March can be explained by buyers taking orders of U.S. soybeans before any retaliation was taken by the Chinese government. Recent trade discussions during a meeting in Geneva in May have seen the tariffs on Chinese products imported into the U.S. fall to 30% from 145%, and China has cut tariffs on U.S. goods to 10%. On the surface, this should be good for U.S. exports and Panamax demand from U.S. ports, but currently, this softening on tariffs is only in effect for 90 days.
China changes import strategy for soybean products
Since the height of the trade war, China has been actively looking to reduce its reliance on imports from the U.S. One way they have achieved this is by looking for different sources for agricultural products such as soybeans. This can be seen by the proportional drop in the quantity of soybean products China imports from the U.S. Back in 2022, over 31% of Chinese soybean product imports came from the U.S.; this fell to just under 23% in 2024. China has made up for the fall in U.S. soybean products mostly by importing more from Brazil. The South American country has seen its share of soybean product imports to China rise from 54% in 2022 to over 64% in 2024.
Adding to the pressure on American soybean farmers is an expectation that the 2024-2025 season will be a bumper year for the crop in Brazil, Argentina, and the rest of South America. The La Nina weather pattern did affect some soybean production on the continent, but on the whole, production is expected to be much larger than the previous year, putting pressure on soybean prices and likely increasing the purchasing power of Chinese importers. Furthermore, the 2025-2026 season will have no La Nina effects, so yields will continue to be strong in South America, again adding pressure on American soybean exports.
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