Nov 12, 2018

U.S. soybean farmers hang on for dear life in Trump's China trade war

Farmer Terry Davidson walks through his soy fields in Illinois in July. Photo: Nova Safo/AFP/Getty Images

America's soybean farmers are hanging onto their crops in an attempt to wait out President Trump's trade war with China, more than doubling U.S. soybean inventories, reports Bloomberg.

The big picture: Retaliatory tariffs have drastically pushed down demand for American soybeans in China, easily the crop's largest market, with imports down by nearly 90%. And prices have fallen, too, as a bushel of soybeans now trades for less than $9 compared to more than $11 earlier in the year.

Between the lines: Unlike corn, soybeans don't store well, so farmers are risking their livelihoods for an economic detente that isn't guaranteed.

  • Soy had become one of the few bright spots in the American farming market given Chinese demand, so production has reached record levels just as demand crashed.
  • But many farmers have the same idea, pushing potential soy storage areas like containers and silos to the limit, forcing some to resort to one-time-use plastic bags. "I’ve heard farmers and commercial companies putting corn and soybeans into tool sheds and caves," Soren Schroder, the CEO of Bunge, the world’s largest processor of soybeans, told Bloomberg.

What's next: Bloomberg pegs soybean futures at $9.27 for next July, meaning that farmers could at least recoup some of their cash — even if it won't be at levels like earlier this year — as hope springs that the U.S. and China could reach a soybean deal at the G-20.

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  1. Global: Total confirmed cases as of 9 p.m. ET: 662,073 — Total deaths: 30,780 — Total recoveries: 139,426.
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Trump flags travel adversaries for New York, New Jersey, Connecticut

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios

President Trump said Saturday night the CDC would issue a "strong" travel advisory" for New York, New Jersey and Connecticut and that a "quarantine will not be necessary."

The big picture: With more than 121,000 people infected, the U.S. has the most COVID-19 cases in the world, exceeding China and Italy, per data from Johns Hopkins. A second wave of American cities, including Boston, Detroit, New Orleans and Philadelphia, are reporting influxes of cases.

Go deeperArrowUpdated 12 mins ago - Health

Trump rules out quarantine in New York, New Jersey, Connecticut after pushback

President Trump on the White House grounds on Saturdya. Photo: Sarah Silbiger/Getty Images

President Trump tweeted Saturday night that he's decided not to introduce quarantine enforcement measures fo New York, New Jersey and parts of Connecticut, but a "strong" travel advisory will be issued for those states.

Why it matters: The president said hours earlier he was considering the move to combat the rise in novel coronavirus cases. But he received pushback, most notably from New York Gov. Andrew Cuomo (D), who told CNN it would cause "chaos." "This would be a federal declaration of war on states," Cuomo added.

Go deeper: Updates on coronavirus in the U.S.