A global glut of soybeans has been pushing down prices

On Wednesday, the Census Bureau will release early trade data for October, providing insight into how much importers brought in and how much exporters sold. One export that’s been on the rise in recent months is soybeans.

That’s because soybeans are getting cheaper. In fact, soybean prices have been falling for more than two years now. And that price drop is because global supplies of soybeans have been rising. Soybean supplies are up because soybean production is up. And soybean production is up because of China.

“The amount of soybeans that China needs to purchase daily is just mindboggling. Like, your jaw drops,” said Naomi Blohm, senior market advisor at Total Farm Marketing.

China slapped retaliatory tariffs on American soybean exports during the Trump administration. So, it’s been buying more soybeans from other countries; especially Brazil, where soybean production has exploded.

“Ultimately they are just the world’s biggest supplier of soybeans right now, and their biggest customer is China,” she said.

Blohm said China is still buying American soybeans. But Scott Irwin, an agriculture economist at the University of Illinois, said American farmers are in a tough spot: They can sell their soybeans now, at today’s low prices, or wait and face the risk that the next administration starts another trade war with China, which could push prices even lower.

“I talk to a lot of farmers on a regular basis, and I’ve described them as nervous as cats on a hot tin roof,” Irwin said.

Either way, Irwin said he expects that in 2024 and in 2025, the soybean business will not be profitable for farmers.