As the US potentially gears up to unleash trade tariffs on China come January, could Beijing bite back at American soy exports, as it did in 2018?
Braemar Research said in a report: “While it would be wrong to assume a full repeat of the events of 2018-20, an extension and increase of tariffs was prominent among campaign promises from the newly elected US president.”
In 2018, Donald Trump’s first administration introduced tariffs of 25% on imported steel and 10% on aluminium.
Swift retaliatory tariffs of 25% from China on US soy helped lower US exports — at a time when swine flu outbreaks in China had suppressed demand.
“While not attempting to second-guess the next administration’s trade policies … October’s seasonal high for (largely panamax) US soybean shipments to China will arrive before the change in presidents,” Braemar said.
October has been the peak month for US soy exports in each of the previous four years.
With East Asia the dominant destination, it has represented a strong month for panamax grain loading from the US Gulf and West Coast.
Vessel tracking data from AXS showed a 4.6m-tonne monthly gain in October for panamax US grain shipments to 7.1m tonnes, the strongest month since 2022.
US grain shipments on geared bulkers — serving a range of destinations in the Americas, North Africa and East Asia — registered only a slight monthly gain.
“China’s soybean imports not only retreated in 2018, but buyers showed a clear preference for beans from Brazil. This was not solely the consequence of US trade protectionism, however, as it coincided with bird flu outbreaks in China,” added Braemar.
Last month, the International Grains Council (IGC) forecast a 10% leap to an all-time high for US soy output between October 2024 and September 2025, coupled with a 4m-tonne gain in exports.
US seaborne exports in 2023 were at 44.7m tonnes according to Clarksons, with shipments slipping to 42.9m tonnes in 2024 and forecast at 41.4m tonnes in 2025.
Is Brazil on the prowl again?
In addition, the IGC projected an “increasing ability of Brazilian suppliers to export sizeable amounts … during the September-January period”, ie, outside the main Brazilian export season and infringing on the US export peak.
Brazil’s soybean availability next year will receive a boost from record production, according to the IGC and other forecasters.
Its seaborne exports reached 101.9m tonnes, Clarksons said, and are set to climb to 105.5m tonnes this year and 106.8m tonnes in 2025.
Consultancy AgResource also claimed in a newswire interview that buyers in China were avoiding the US for January delivery onwards.
Braemar concluded: “Soyabeans were the focus of China’s retaliatory tariffs in 2018, but since then the country has raised imports of corn and wheat substantially.
“That said, shipments of US corn and wheat to China have been reducing in volume through the course of the year, judging by shipment and official trade data.”
