When China Walks Away

In 2025, U.S. soybean shipments to China dropped nearly 39% by volume, a steep decline for what was once the largest buyer of American soybeans. This disruption has sent shockwaves through the farming community, leaving the future of soybean production and sales up in the air.

To understand what the industry and farmers can expect, Polly Ruhland, senior managing director in FTI Consulting’s Food, Ag and Beverage practice and former CEO of the United Soybean Board (USB), shares her thoughts and expertise.

At USB, Ruhland helped guide more than $120 million in program investments, driving innovation in biotechnology, production improvement, sustainability and research and development for soy-based industrial products.

“The soybean industry has been working in response to China’s decline in purchases since the trade tensions began in 2018,” Ruhland said. “For example, industry organizations like the U.S. Soybean Export Council led industry efforts to diversify U.S. export markets as one notable effort.”

Trade Disruption Equals Structural Reset

Before 2018, the U.S. and China had a strong relationship surrounding soybeans. Large shipments were sent to feed China’s livestock, supporting U.S. acreage, infrastructure and market expectations. But as the trade war intensified, China shifted.

Ruhland said the industry recognized the danger early on: 

“The industry realized during President Trump’s first term that China’s reduced purchases, due to trade disruption, represented a significant threat to the market. This threat could well result in a structural market reset, not just a short-term disruption, and that has happened. At that time, leading organizations and companies came together to initiate diversification initiatives.”

By 2025, the result was clear – China’s share of U.S. soybean exports has fallen to about 29%, down from more than 50%. According to Ruhland, countries such Mexico and those in the European Union now account for more than 20% of total exports.

“We’ve seen growth in exports to other countries, too,” she noted. “U.S. exports to Egypt, for example, rose year-over-year, and we’re seeing similar increases in countries like Colombia and Vietnam.”

Although these markets don’t measure up to China by any means, Ruhland says they do show the efforts of the sector to diversify and build global market strength.

Finding New Buyers

Expanding into new markets is a large part of a broader strategy. Although they [new markets] are smaller now, they’re less volatile and less concentrated. 

“U.S. soybean companies and organizations also are focusing on promoting sustainability to appeal to European buyers,” Ruhland said, “expanding our markets in Southeast Asia, North Africa and Latin America and improving infrastructure for grain transport. This kind of proactive approach has not only helped offset the decline in exports to China but has also strengthened our relationships and markets across various regions.”

Ruhland added that while soybean trade with China has “sharply diminished,” the broader trade picture is more optimistic than it might seem.

“U.S. soy exports show expanded access and strengthening relationships across Asia, Africa and Latin America – an international outcome of the industry since 2018,” she noted. “That said, China is a critical market for U.S. soybeans, and efforts to retain and grow this market will remain essential to the health of the U.S. soybean industry.”

The Costs of Change

Diversification doesn’t come cheap. Shifting away from China may strengthen long-term resilience, but it has created financial strain for many U.S. producers and farmers.

“Losing a buyer that normally purchases over one-third of U.S. soybean exports sharply impacts margins and acreage decisions,” Ruhland said. “This level of market disruption is never good, especially in the short term, and this is no exception.”

Recent reporting has found that U.S. soybean farmers have seen input costs increase. Tariffs on chemicals and parts, and supply-chain disruptions have increased costs by 20% to 30% in some inputs. With China stepping back, unfilled export orders and storage constraints have become more difficult.

“This situation, combined with myriad existing market factors and disruptions, exposed vulnerabilities in on-farm liquidity,” explains Ruhland. “Elevated input costs and limited storage capacity, although that has expanded since the 2018 trade disruption, have pressured working capital, particularly for Midwestern producers who are holding inventory to wait for better prices.”

Farmers are adapting, however. Some are reducing acreage, while others are investing in own-farm storage or shifting to other crops. 

 

Other Factors at Play

China’s pullback, Ruhland said, stems from a mix of geopolitical, structural and economic forces.

“It’s not a simple formula,” she explained. “Tariffs on U.S. soybeans, currency effects and China’s feed reform policies have all curtailed imports.”

Chinese buyers have been consciously sourcing more from Brazil and Argentina for several years and for multiple reasons, such as harvested calendars aligning better with feed demand.

“Structurally, China has a long history of effectively cutting reliance on geopolitically sensitive suppliers and boosting domestic soymeal alternatives, like swine rations with reduced soybean content,” she added.

Put simply, China’s cutback isn’t just for political reasons, it’s partly due to long-term risk mitigation. For U.S. farmers, this means relying on China as the dominant export partner may be over — at least for now.

A Shift to Value-Added Soy

With soybeans under pressure, the U.S. industry is increasingly looking for new opportunities.

According to Ruhland, the U.S. will need to make a strategic shift to include expansion of value-added processing domestically – which includes more soy animal feed than exported as high-quality U.S. animal protein, especially to emerging protein economies in Asia and Africa.

“Another key factor will be growing U.S. soybean meal and oil demand in biofuels,” she added.

Soybean oil is a primary ingredient in renewable diesel and sustainable aviation fuel. These markets create new domestic demand by also stabilizing prices by reducing dependence on export fluctuations.

“Longer-term strategy now centers on being the soybean ‘supplier of choice’ through reliability, sustainability and logistical efficiency rather than dominant volume to a single buyer,” Ruhland said.

This shift could mean U.S. soybeans increasingly leave the country as protein, fuel or other refined goods. This would be a major step forward from exporting in bulk to producing value-added products instead.

Looking Ahead

In the future, Ruhland believes the U.S. soybean industry’s resilience will depend on strategic investment and adaptability. Building new global relationships, expanding domestic processing and reinforcing the supply chain are all crucial steps.

But China shouldn’t be ignored. Rebuilding and maintaining that relationship will be essential. The difference now is that U.S. soybeans no longer depend on one market to survive.

Ruhland summed it up well: this period of disruption has also been one of the most productive transformations in U.S. soybean history. The industry’s response of innovation, sustainability and diversification, is not just about recovering lost sales. It’s about redesigning the future of American soy for a multipolar world.

Farmers Takeaway

• Diversify buyers — look to feed, biofuel, or local processing co-ops.
• Invest in storage — timing matters more than ever.
• Track emerging markets like Egypt, Vietnam, and Mexico.