With farm income down 50 percent in the past five years, the Minnesota Soybean Growers Association (MSGA) is disheartened by China’s declaration Friday of a retaliatory 25-percent tariff on U.S. soybeans.
“Soybean prices have dropped nearly 20 percent since the tariffs were first proposed this spring, and prices are currently at their lowest point in a decade. This news obviously won’t help matters and is extremely unwelcoming,” says MSGA President Michael Petefish. “History shows us that no one comes out a winner in a trade war.”
China purchases 61 percent of total U.S. soybean exports, equating to nearly $14 billion annually and more than 30 percent of overall U.S. soybean production. Soybeans are Minnesota’s top export, equating to $2 billion annually. China is the largest importer of Minnesota soybeans.
“Countless hours and resources over the decades have been spent developing these overseas markets,” says Minnesota Soybean CEO Tom Slunecka. “To needlessly jeopardize these markets over a matter of months is disturbing, and we implore the Trump administration and the Chinese government to come to a quick resolution.”
China’s tariff is in response to President Trump imposing Section 301 tariffs on $34 billion of Chinese products. MSGA will continue to urge both countries to rescind their tariffs.
“In many towns in Minnesota, agriculture is the backbone of the local economy,” Petefish says. “When agriculture prospers, entire communities profit. Consequently, when farmers suffer, so do their neighbor and local businesses. With margins already razor-thin, farmers can ill-afford to carry this extra burden in this unsteady economic climate.”