Soybean flows are changing, but who reaps the rewards?

Through our dry bulk flow tool, we have identified changing trends in the trade of soybean products. In particular, flows are changing as China looks to other regions to source soybeans and soybean meal in response to Trump's tariffs on goods from China. This insight looks at who the big winners have been and how the changing flows impact the shipping market.
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Soybean product cargo volumes do not give the full picture

On the whole, soybean export volumes in 2025 do not look dissimilar to those of recent years. As a result, it would be easy to assume that nothing in the market has changed.

However, a deeper look into the market shows some compelling changes in trade flows. The major change has come from lower exports of soybean products from the U.S., which first started to decline during the 2018-19 marketing year. Figures from the Food and Water Watch (FWW) show that farm bankruptcies surged 24% that year, as Trump’s first-term trade policies led the U.S.’s largest soybean export market, China, to hit back with a 25% tariff on soybeans. This tariff rose further in 2019 to 35% as the trade war intensified, before some allowances were made on quantities of soybeans.

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Since Donald Trump’s re-inauguration in January 2025, tariffs have been used broadly by the U.S. government, with retaliatory tariffs issued back. As a result, all imports from the U.S. into China received a 125% tariff at the beginning of April. The spike in soybean product exports in March can be explained by buyers taking orders of U.S. soybeans before any retaliation was taken by the Chinese government. Recent trade discussions during a meeting in Geneva in May have seen the tariffs on Chinese products imported into the U.S. fall to 30% from 145%, and China has cut tariffs on U.S. goods to 10%. On the surface, this should be good for U.S. exports and Panamax demand from U.S. ports, but currently, this softening on tariffs is only in effect for 90 days. 

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China changes import strategy for soybean products

Since the height of the trade war, China has been actively looking to reduce its reliance on imports from the U.S. One way they have achieved this is by looking for different sources for agricultural products such as soybeans.  This can be seen by the proportional drop in the quantity of soybean products China imports from the U.S. Back in 2022, over 31% of Chinese soybean product imports came from the U.S.; this fell to just under 23% in 2024. China has made up for the fall in U.S. soybean products mostly by importing more from Brazil.  The South American country has seen its share of soybean product imports to China rise from 54% in 2022 to over 64% in 2024. 

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Adding to the pressure on American soybean farmers is an expectation that the 2024-2025 season will be a bumper year for the crop in Brazil, Argentina, and the rest of South America. The La Nina weather pattern did affect some soybean production on the continent, but on the whole, production is expected to be much larger than the previous year, putting pressure on soybean prices and likely increasing the purchasing power of Chinese importers. Furthermore, the 2025-2026 season will have no La Nina effects, so yields will continue to be strong in South America, again adding pressure on American soybean exports. 

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Key takeaways

Given current market conditions, China will continue to source soybeans from countries other than the U.S., most likely Brazil and other South American nations. The next two harvesting seasons will see even more pressure on U.S. soybean demand as weather patterns in South America become more conducive to soybean yields, giving ample supply for Chinese buyers.

As a result, several U.S. port regions could see demand for Panamax and supramax vessels decrease. The U.S. West Coast region is the most exposed. Over 72% of vessel demand in the region is made up of Panamax or Supramax demand, with soybean products driving close to 21% of that demand, and almost all of that cargo is destined for China. The U.S. Gulf Coast is also exposed to this change but not as heavily. 

Demand for panamax and supramax vessels from Brazil is set to rise. Greater yields of soybean production across the harvest period in 2025 and into the next year alongside greater desire from Chinese buyers to purchase from non-U.S. producers will create a positive environment for vessel demand from South American ports, in particular Santos in Brazil and San Lonrenzo in Argentina.

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