US soybean farmers: window is closing for farming business amid trade tensions

In the wake of new US tariff increases on Chinese products, US soybean farmers are calling on the US government to resolve the issue now.

53-year-old John Boyd arrived at his farm to meet with us half an hour later than scheduled.

John Boyd, a fourth generation soybean farmer, examines conditions of his farm in Baskerville, Virginia, on May 15th, 2019. [Photo: China Plus/Liu Kun]

He said the tariffs the Chinese side has put on soybeans has limited his cash flow, saying he now can't afford technicians, forcing him to become the lone mechanic on his farm.

"I was late coming over here today because I was making repairs to the tractor which generally I would've sent that tractor off to a shop or experts to fix it. And because of my financial strain, we are here and my own shop on the farm is trying to pass this."

A 4th generation soybean farmer, Boyd owns lands in Baskerville, a small area in southern Virginia bordering North Carolina.

This picture shows part of John Boyd's farm in Baskerville, Virginia, on May 15th, 2019. [Photo: China Plus/Liu Kun]

He has 700 acres of land, of which 400 are used for soybean production, which is his main source of profit.

When the US government launched its trade fight with China in March of last year, announcing tariffs on Chinese goods worth hundreds of billions of US dollars, the Chinese government was forced to respond.

This included Chinese tariffs on soybeans and other American goods.

When asked about how his farming business has been since then, Boyd's frustration was clear:

"Oh man I am past word. I am part worried, I am part frustrated. And I am very disappointed in the President's leadership, inability to fix this. The prices of soybeans, when they peaked, were 16.8 dollars (per bushel). And now on the US market here, the prices of soybeans are hovering around 8 dollars or less. That's a 50% reduction in income for me. It's been a strain. It's been a financial strain on our farming operation. The imposition of the tariffs have totally changed the income on the farm, and the way that we are doing business. It's also put a strain on the future of the farm if the China avenue isn't open, if that door doesn't get open swiftly here."

Apart from drops in prices and profits, many US soybean farmers are also worried about the long term effect on US soybeans' competitive edge in the international market, i.e. the ability to present reliable products with the help of advanced technology, steady logistics and so on.

This picture shows farming machineries scattered on John Boyd's farm in Baskerville, Virginia, on May 15th, 2019. [Photo: China Plus/Liu Kun]

Brent Bible is a soybean and corn farmer in Lafayette, Indiana.

He is among a pro-free-trade group in the US calling itself "Tariffs Hurt the Heartland."

"It has made it such – by changing the price as much as the tariffs have – it's made it so uncompetitive that other countries are willing to now take the risk that some of the South American countries have in terms of logistics, safety, and being reliable with being able to present a product for sale. The further time goes on and they are able to continue to do that, then the reliable market that we've always been able to present is eroding away."

One of the reasons the US cited when starting trade frictions with China a year ago was that the two had disputes in areas such as intellectual property rights. To Boyd, on the one hand, soybeans have been innocently caught in a trade crossfire; on the other, even if disputes do exist, tariffs are not the right way to address them

"Tariffs should be the last thing to happen. I do not think it's the right approach. A more diplomatic approach could be taken. So I believe good conversation and good leadership could help fix that."

In a recent interview with Chinese media, Davie Stephens, President of the American Soybean Association noted it took U.S. farmers more than 40 years to build the soybean market in China, warning that the market will become increasingly difficult to recover as the U.S.-China trade tension drags along.

Boyd noted almost all his soybeans go to China, saying that the prices of soybeans during the first harvest season last October since the tariffs came into effect felt like a "reality slap."

Earlier this month, in the midst of bilateral negotiations, the US government suddenly announced a tariff hike from 10% to 25% on Chinese goods, further escalating tensions between the two economies and creating more uncertainties in the market. When asked about his plans for this year, since it's planting season now, Boyd replied:

"Well I don't know. I don't know what I am going to do now. And that's a bad position to be in as a farmer. I am not just a farmer, I am good farmer, because I've been farming 35 years. My ability to farm is not what's in question. The question is what the President of the United States is going to do to act swiftly to fix this for American farmers like myself."

To help US farmers affected by trade tensions, the US Department of Agriculture announced an ambitious subsidy program totaling 12 billion dollars last July.

Boyd is among those who submitted his application immediately, but has yet to receive any money. More importantly, he said, he wants a fair market, not subsidies.

"I haven't received a dime of that. And I have reached out to the Agriculture Department to ask them about the delays. And those requests have fell upon deaf ears. I don't want the aid, I want a fair price for my product."

Boyd, also President of National Black Farmers Association, said he's been hoping to press his concerns with the Trump administration by requesting meetings with President Trump and Agriculture Secretary Sonny Purdue, but neither has responded to his requests.

"I've known Sonny Purdue for about 25 years. And I am disappointed that he hasn't had this meeting."

John Boyd, a fourth generation soybean farmer, operates a tractor on his farm in Baskerville, Virginia, on May 15th, 2019. [Photo: China Plus/Liu Kun]

Boyd said he will continue his petition and that he hopes to tell President Trump that US farmers just can't take the tariffs any longer.

"Window is closing. Time is of the essence. And there's an urgency of now, right now, that this needs to be fixed. We don't have time. And if he (Trump) doesn't (fix this now), there will be thousands of farmers on the auction block in the United States. That means they will lose the farm. They merely can't pay the debts with 8 dollars a bushel beans. It's just not feasible."