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Commentary: Soy growers need trade, not tariffs

On June 21 an op-ed ran in this publication that, when summarized, asked why the American Soybean Association wasn't supporting President Trump's Section 301 tariffs. ASA and the North Dakota Soybean Growers Association have an answer: Because it unnecessarily places soybean growers who have worked for decades to create a soybean market in China in the crosshairs of a trade war.

Soybeans are one of the brightest lights in U.S. exports — soy is the No. 1 agricultural export, with sales of $27 billion last year according to the Foreign Agricultural Service. Of those $27 billion in soy exports, $14 billion worth of soy and soy products were sold to China, our largest trading partner. In fact, North Dakota farmers exported approximately $1.5 billion in soybeans to China last year.

This is not a market that appeared overnight. Soybean farmers have worked with the U.S. Department of Agriculture and both private and public business partners for decades to develop foreign markets for soybeans and have seen the value of U.S. soybean exports to China grow immensely. Just the talk of imposing these tariffs has strained relationships that will take substantial time to rebuild.

Due in part to the work of the U.S. Soybean Export Council, China grew from a small soy market to the largest in the world, and market opportunities continue to grow, but we need trade policies at home that support growers and the exports they depend on.

China has stated that it will retaliate in-kind to the Administration's Section 301 tariffs, with a 25 percent tariff falling on U.S. soybeans. According to a study conducted by Purdue University, it is projected that China's soybean imports from the U.S. would fall by 65 percent and total U.S. soy exports would drop by 37 percent.

Brazil is already the world's largest soybean exporter and is poised to fill the void in the event that U.S. soy exports to China decrease. Over the next 10 years, Chinese demand for soybeans are projected to grow from 97 million metric tons in 2017 to 143 million metric tons in 2027 — more than 10 times our soy exports to the EU. There is room for us to grow our exports to China, which has proved to be a robust and vital marketplace, and we should be focused on ways to expand trade instead of restricting it with tariffs.

We understand the need to at times review and renegotiate our nation's trade agreements. However, agricultural exports have for years been the strongest positive contributor to our nation's balance of trade. Instead of being collateral damage in a trade war and giving up hard-earned Chinese market share, the ASA and, in turn, state soybean associations like ours here in North Dakota have urged the administration to look for ways soybeans - and all of agriculture - can increase trade opportunities to be part of a solution to reducing our trade deficit with China.

Peterson, Valley City, N.D., is a soybean grower and director with the American Soybean Association and serves as vice chairman of the U.S. Soybean Export Council. Gackle, Kulm, N.D., is director of the American Soybean Association.
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