Some South Dakota farmers and ranchers recently took to Capitol Hill to voice their concerns about trade impacts on the ag community.
For soybean farmers, this isn’t their first rodeo. And though the feds urge patience, producers are finding that’s one commodity in short supply.
“For decades our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike,” said President Donald Trump on April 2 this year, when he announced his sweeping tariffs, or taxes paid by Americans on imports from foreign nations. On that date he said a large reason for enacting the economic legislation was to protect farmers.
“We’re also standing up for our great farmers and ranchers who are brutalized by nations all over the world. Brutalized,” President Trump said.
While the tariffs have ebbed, flowed and changed entirely across different countries, since April 2, one thing remains the same: uncertainty for producers and ranchers. Farmers faced similar uncertainty during the first Trump Administration.
Chad Johnson is a corn and soybean farmer from northeastern South Dakota. He said he took to Washington to find answers, but hasn’t found anything new.
“It’s kind of the same thing we’ve been getting out of a few different places. We just got to talk to USDA and they kinda said, ‘We should trust the system. This is going to be good in the long run.’ But that’s, you know, with bankruptcies up in the farming community over 90% from the year prior, that’s not gonna, that’s not good enough,” Johnson said. “We need help now. They need to start doing something. Either end the tariffs or come up with a trade agreement to get these tariffs ended so we can start building on what we’ve done for many, many years.”
In 2018, farmers and ranchers were hurt by retaliatory Chinese tariffs, so the federal government paid them billions in direct funds in attempt to offset losses. Despite the payments, farm debt, delinquencies and bankruptcies rose during that time.
Soybean farmers were hit especially hard by Chinese retaliatory tariffs, and it appears they could be feeling déjà vu now. President Trump is imposing a 30% tariff rate on Chinese goods. However, NPR reported that the U.S. Supreme Court is examining whether the president's tariffs are lawful.
According to the U.S. Trade Representative, South Dakota exported $1.4 billion of soybeans in 2023 – more than doubling the next closest product. And nonprofit Farmers for Free Trade said China is the top destination for those beans.
Chad Johnson said farmers want their dollars coming from trade…not the US government.
“We need an avenue for our markets, whether it’s corn, soybeans, wheat, whatever it is. When these trade wars happen, it kills everything that we’ve developed over many, many years. Back in ’16, ’17, yeah, we got some direct payments to help kick the can down the road, but at this point in time they have not really spoken much about giving us any direct payments,” Johnson said. “Short-term, they haven’t really, and we’ve asked, they haven’t given us an idea if there’s going to be payments because we really don’t have a Farm Bill at this time either.”
According to Reuters, China makes up over 60% of global soybean trade, with the European Union a distant second at 8%. That means the soybean industry faces a bitter reality: there may be other markets, but China’s easily the largest fish in the sea.
Amid the current U.S.-Chinese trade war, China is opting for other soybean markets like Brazil, the U.S.’s biggest competitor. China’s boycott of U.S. soybean outputs has created an issue for South Dakotans. The American Soybean Association says that’s caused the price per bushel to plunge.
Andrew Streff is a corn and soybean farmer from Salem, South Dakota. He said his biggest issue is that this has nothing to do with economics.
“When you take into account all of the costs of shipping, exchange rates and basis throughout the world, U.S. grown soybeans are the cheapest beans in the world,” Streff said. “And China is still not coming to buy our beans. So, it is purely political at this point that China’s not purchasing beans from the United States. So that’s the part that I don’t care for in this whole thing, is that the true economics of this aren’t necessarily coming into play like I wish I could.”
He said it’s a hard reality to accept.
“Nobody likes being used as a bargaining chip or a pawn in this whole great thing,” Streff said. He added, once producers accept that reality, "then we can move forward with adjusting our business strategies, doing different agronomic plans on our operations, tightening the belt on some of our spending at the farm and making sure that we’re paying close attention to our profitability levels and hedging off some of that risk when the price does give us the opportunities.”
Regardless, Streff said he’s not giving up hope on a resolution just yet.
“I remain very optimistic. And I think the farmer as a whole is always optimistic,” Streff said. “You have to have quite a bit of faith in the future if you’re willing to plant the seed in the spring and pray for rain and let it all take care of the rest.”
He said despite the lower price per bushel, he’s optimistic they’ll cure themselves and fuel other uses and demands for the crop. That could include pushes to expand the market to use soybean oils for biofuel and biodiesel.
