The anticipated bumper harvest of U.S. soybeans this fall amid a trade dispute with China presents an opportunity for growers to reach new international markets with containerized shipping.
Farmers this spring sowed more soybeans than corn for the first time in 35 years. But prices have dropped since China, the world’s biggest market for soybeans, placed a 25% tax on imported U.S. soybeans, in response to U.S. tariffs on a swath of Chinese goods. As a result, Chinese importers have turned to other sources of soybeans, and American farmers are storing more of their harvest.
“This trade shift is occurring against the backdrop of a fall harvest that experts forecast to be record-setting in terms of production,” said Eric Woodie, Illinois Soybean Association (ISA) Trade Analyst. “We see a major opportunity in containerized shipping of soybeans, which will open the door for American farmers to access new Asia-Pacific and European markets.”
Containerized shipping offers several benefits for the U.S. soybean industry. It better meets the needs of customers who want to purchase smaller quantities, minimize their inventory investment, purchase soybeans with precise product attributes or seek fast turnaround of their orders to increase time-to-market and/or maintain quality.
Containerized shipping can also benefit producers, cooperatives and small suppliers who cannot fulfill demand for large shipments via bulk vessels. In fact, by 2019, the global container market demand is projected to increase nearly 5 percent over just three years.
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Illinois is the top soybean producing state and is well-positioned to capitalize on containerized shipping for international soybean export because of its access to empty ocean containers and a mature intermodal infrastructure. The ISA checkoff program sees a major opportunity for growers to take advantage of ocean containers now returning empty to export markets.
The ISA checkoff and membership programs represent more than 43,000 soybean farmers in Illinois. The checkoff funds market development, soybean production and profitability research, issues analysis, communications and education. Membership and advocacy efforts support Illinois soybean farmer interests in local areas, Springfield and Washington, D.C., through the Illinois Soybean Growers.
ISA programs are designed to ensure Illinois soy is the highest quality, most dependable, sustainable and competitive in the global marketplace. For more information, visit the website www.ilsoy.org.