The first US government forecast incorporating the agricultural fallout from its trade war with China has come to a firm conclusion on soyabeans: China will import less, American farmers will lose business and Brazil will be a beneficiary.
Beijing last week increased duties on imported US soyabeans, cotton and other products by 25 percentage points in response to tariffs on Chinese goods imposed by Donald Trump’s administration. Soyabeans are the US’s largest agricultural export to China and are grown in rural states that mainly voted for Mr Trump.
As the top soyabean importer, accounting for more than 60 per cent of global trade, China’s move has rattled markets. Soyabean futures have slumped to levels at which many US farmers will lose money without federal assistance.