The Two Prices of Soy

Last autumn, US silos and grain elevators brimmed with a bumper crop of soybeans, yet soy farmers were decidedly not brimming with joy. They were anxious because their biggest market, China, had vanished. So many unsold soybeans needed storage that latecomers to the grain elevators, or those whose beans were less than perfect, were turned away. There just wasn’t enough room. Some farmers had no choice but to pile their beans on the ground, at the mercy of nature, or give up and plough them under to rot.

The trade war descended on these farmers on 6 July 2018, when US tariffs on Chinese goods, designed to punish China for unfair trade practices, went into effect. China retaliated by placing steep tariffs on its US agricultural imports. Foremost among those imports are soybeans. The tariffs made US soybeans an expensive choice for Chinese businesses, so they found other options.