Trade wars cost billions at soybean harvest season
WELLS, Minn. (FOX 9) – Severe struggles are hitting soybean farmers as the harvest season gets underway.
They’ve lost billions of dollars in sales already this year, and there’s no end in sight to the losses.
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Farm struggles
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Economic pressures:
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Soybeans and corn grow across 4,500 acres of Faribault County belonging to Darin Johnson’s family since the early 1900s.
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“So we’ve been around for quite some time,” he said Tuesday.
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But the landscape keeps changing around this fourth generation farmer.
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Farm bankruptcies are up 95% since 2022. The cost of doing business is up, but sales prices are going down.
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“And those numbers don’t look good and are not improving, particularly because of the soybeans and the trade war that continues to put pressure on those markets,” said Cindy VanDerPol of the Minnesota Farmers Union.
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Trade war bullseye
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No magic beans:
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The level of urgency is especially high right now for Minnesota soybean farmers.
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Harvest season is now and this crop is ready to go, but trade wars are giving farmers a tough situation to swallow.
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They’re right in the bullseye for tariff retaliation, and their biggest export market is now a black hole. Almost all of the northern Minnesota soybean crop usually goes to China, but this year that market is dried up.
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“Nothing’s moving,” said Johnson, who is also president of the Minnesota Soybean Growers Association.
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China usually buys $12-13 billion worth of American soybeans every year, but they haven’t bought any in months.
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Instead, they’re importing for the first time from Argentina and expanding long-term contracts with Brazilian farmers.
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“It’s going to be tough to get some of that business back that we’re losing,” Johnson said. “Retaliatory tariffs have caused us to be less competitive in the global marketplace.”
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Limited options
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Loss leader:
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In the short term, most Minnesota soybean farmers will harvest their crops and either sell them at a loss or pay to store them, or a little of both.
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But they can only last so long with income at or near zero.
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And it’s not just soybeans.
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China has also curtailed its imports of American corn, wheat and sorghum.
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“There have been times like this in the past and we’ve gotten through it and I know we will again,” Johnson said. “We just need to make sure that we are making trade deals and get them done in a timely fashion.”
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Tariffs to taxpayers?
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What’s next:
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The first Trump administration gave farmers a $28 billion bailout after a 2018 trade war, but some analysts say China was better prepared this time, so this battle could rearrange the global trade map.
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