The soybeans of Arthur, N.D., northwest of Fargo, aren’t waiting for an end to a trade war that seems to have no end. They’re going to rot.
It was a good year for growing soybeans in these parts. Not so good for selling them.
The farmers of Cass County grow more soybeans than any other county in America, the New York Times reports in its story today. But China has stopped buying them. Soybean sales have dropped 94 percent.
The U.S. exported $26 billion in soybeans last year; more than half went to China, which has now put tariffs on them.
China pretty much created the soybean market for North Dakota farmers, many of whom gave up on wheat in the ’90s to cash in on the hot new crop. Now, they’re piling up behind full grain elevators.
Public health officials in North Dakota, already confronting a recent rise in suicides, are concerned about the impact of falling prices, particularly on younger farmers with high levels of debt, the Times says.
“They could get together tomorrow and iron this thing all out and I don’t think we’ll ever get all of our market back,” one farmer says.
Brandon Hokama, whose family farms 3,500 acres near Ellendale, N.D., estimates that they need a price of $8.75 per bushel of soybeans to break even. Last year at this time, soybeans could be sold for almost $10 per bushel. Now, local elevators are offering prices below $7.
Farmers typically begin to purchase seeds and fertilizer before the end of the year, so the low prices are shaping next year’s crop. The Hokamas divided their land evenly between soybeans and corn this year; next, they plan to plant half as many acres of soybeans. Instead they will devote more land to corn, and also to some wheat for the first time in two decades, and perhaps specialty crops like peas and black beans.
Mr. Hokama knows that other farmers are likely to make similar decisions, and that the corn market next fall may be glutted. Specialty crops like peas and edible beans command higher prices, but also require more work and specialized equipment. Also, unlike the big cash crops, specialty crops can’t be hedged. That means the farmer carries all the risk of a bad year.
The goal for next year? Break even.