On April 11, 2025, China announced a 125% tariff on imports originating from the United States, causing a significant spike in U.S. soybean prices. Specifically, in April 2025, the FOB price of U.S. soybeans in the U.S. Gulf was approximately $450 per ton. After the 125% tariff was implemented, the landed price of U.S. soybeans in China surged to $1,026 per ton—well above the price of Brazilian soybeans, which stood at around $580 per ton during the same period. This price gap directly led to a near halt in U.S. soybean exports to China, while Brazilian soybean imports saw a dramatic increase.

In the week following the tariff announcement on April 11, 2025, Chinese importers quickly placed orders for at least 40 bulk carriers of Brazilian soybeans. These shipments, expected between May and July 2025, will amount to 2.4 million tons—roughly one-third of China’s average monthly soybean imports. More importantly, Brazilian soybeans were 15% cheaper than U.S. soybeans, offering significant price advantages to Chinese importers.

Impact on the United States

In recent years, the share of U.S. soybeans in the Chinese market has dropped sharply, from 40% in 2016 to just 18% in 2024. Despite this, China remains the largest export market for U.S. soybeans. In 2024, the U.S. exported over 27 million tons of soybeans to China, worth $12.8 billion, making up 9% of total U.S. exports to China.

However, with the outbreak of the U.S.-China trade war and the imposition of tariffs, U.S. soybean prices surged, causing China’s imports of U.S. soybeans to decrease dramatically. U.S. soybean farmers have faced unprecedented economic pressure. Some reports indicate that certain farmers are losing as much as $150,000 per month. Moreover, many farmers have not yet recovered from the financial losses caused by the 2018 trade war, and they are deeply concerned about the future, especially with the possibility of another tariff conflict in 2025, which could result in even larger losses.

The U.S. tariff policy has not only affected domestic farmers’ incomes but has also forced the global market to seek alternative suppliers. China has increasingly turned to countries like Brazil for soybean imports, further weakening the U.S.’s dominance in the global soybean supply chain, with profound implications for U.S. agriculture and the broader economy.

Impact on Brazil

As China shifts away from U.S. soybeans and toward Brazil, Brazil has quickly become China’s largest supplier. Together, the two South American countries account for 52% of global soybean production, with Brazil contributing 40%, and the U.S. accounting for 28%. Notably, Brazilian soybeans are 15% cheaper than U.S. soybeans, which has led to a sharp increase in demand for Brazilian soybeans in the Chinese market, further consolidating Brazil’s position as a dominant player in the global soybean market.

Impact on China

By shifting to Brazilian soybeans, China benefits from a significant cost advantage. This not only helps China reduce the cost of bulk commodity imports but also ensures the diversification of its soybean supply, thus mitigating the risk of price volatility in food imports. This shift has deepened economic cooperation between China and Brazil, particularly in agriculture and energy sectors. The increasing market share of Brazilian soybeans in China could have a profound impact on the global soybean market, potentially giving China more influence in the global soybean trade.