When Keytesville farmer Ronald McNeall started farming in 1966, the price of soybeans was about $3 per bushel.
“We were thrilled when they got over $10 a bushel,” McNeall said. “We thought we were entering a new world.”
Missouri farmers fear they are about to enter a bleak world: China’s mere threat of a 25 percent tariff on beans has already driven down soybean prices.
Soybean prices dropped by at least $1.30 per bushel since President Donald Trump announced June 15 that the United States will impose tariffs on $50 billion of Chinese goods, said Greg Luce of the Missouri Soybean Association.
The current cash price of soybeans is $8.37 per bushel, according to Mid-Missouri MFA.
“That’s huge,” said Luce, research director of the Missouri Soybean Merchandising Council. “And that’s just based on the announcement of the tariffs. Nothing has really taken effect yet. So, that is just leading up to it so it could have a greater impact on the price.”
Trump has complained about trade deficits with various nations. He has announced a 25 percent tariff on a number of Chinese goods, to take effect July 6. China has responded by imposing a 25 percent tariff on soybeans.
Luce said that soybeans are Missouri’s most important crop. The value of Missouri’s soybean exports is $1.26 billion, and the state ranks No. 8 in exports, according to the Missouri Crop Resource Guide.
Six out of 10 rows of soybeans are exported, Luce said, and of those six rows, three will go to China.
“Farmers are definitely hopeful that negotiations will settle things in a reasonable manner,” Luce said. “At this time, it looks pretty hard on the soybean farmers of the Midwest and Missouri.”
Ironically, agriculture is one industry where the U.S. is not running a trade deficit, said Robert Alpers, a Cooper County farmer.
“That’s the hard part about this because we’re the ones who are making it work, and we are actually selling more than we are using,” Alpers said.
“A lot of the industries are receiving more. So, it makes it really difficult whenever we are the ones doing our part for a positive balance of trade and then taking a hit like we are.”
Alpers said the balance of trade for the United States is “really messed up.”
McNeall said he is concerned about the tariffs, but he thinks his farm will survive it.
“Sometimes you got to go through rough times on negotiations to get what you need done,” McNeall said.
The economic effects of trade-war tariffs can ripple beyond farmers into rural communities. When farmers are going through tough times, they make fewer purchases and will hold off on replacing equipment, Luce said.
“That impact affects the economy of small towns that depend on agriculture greatly, so it affects far more than just the growers,” he said.
Alpers said he is already preparing for the possible tariffs. He isn’t planning to make any capital purchases for his farm until he knows how the tariffs will affect him.
“We kind of go into sustain mode,” Alpers said. “We always try to do better, but a lot of the things we do, we will have to back off of.”
Alpers said he hopes this will be resolved soon. If prices fall too low, he said he may have to turn to growing other crops. He doesn’t want to do this because it would throw off the crop rotation he has planned to help conserve the soil.
“We are going to deal with this one way or another,” Alpers said. “We will make the best of it.
“Unfortunately, if it continues, we may have to adjust the crops we grow, but we hope it is going to be getting settled.
“It’s not just for the farmer, but for America.”