Soybean prices collapsed to a nine-year low this week after another round of escalated trade disputes between the United States and China. Beans fell to $8.41 per bushel on Tuesday after President Trump threatened to target another $400 billion in Chinese imports with tariffs, up from the initial $50 billion targeted, prompting a response from the Chinese that they would “strike back hard.”
Many in the agricultural community had hoped that the trade dispute would calm down, but the first round of U.S. tariffs begins in on July 6, leaving little time for a deal to be cut. China buys one-third of all U.S. soybeans, and their proposed counter-tariffs will hit soybeans directly, likely diminishing Chinese demand for U.S. soybeans.
After the early week washout, prices recovered significantly but were still trading under $9.00 per bushel on Friday, a price that could be devastating for farmers if it doesn’t recover.