Trump said soybean prices have gone up. They’re near decade-lows.

President
Donald Trump holds up hats that read “Make Our Farmers Great
Again!” as he walks across the South Lawn before boarding Marine
One at the White House in Washington, Thursday, Aug. 30, 2018,
for a short trip to Andrews Air Force Base, Md., and then on to
Evansville, Ind., for a rally.
AP
Photo/Andrew Harnik

• President Donald Trump said
  soybean prices have gone up.
• They have fallen to near decade lows since his trade
  war with China began.
• China has turned to South American countries to replace
  US soybeans. 
• Soybean stocks are approaching record
  levels. 
• 
  Watch soybeans trade in real time here.

President Donald Trump claims US soybeans
have largely held up against his trade war with China. But
tariffs have pushed prices to lows not seen since 2008. 

“And soybeans are going up, and things are going up,” he said at
a press conference in New York on Wednesday. “And we’ve had very
little hurt, from what I’ve done. In fact, the markets have gone
up, and the farmers are going to do great.”

In reality, soybean
prices have fallen more than 12% since China placed a 25%
import tax on the legume to retaliate against the Trump
administration. That country is the largest-soybean customer in
the world, accounting for more than half of global imports in
2017. 

“There’s a lot of concern about the future,” Gary Schnitkey, a
farm management specialist and University of Illinois professor,
said. “Because [soybean farmers] are going to see much lower
prices as a result of tariffs.”

Also on Wednesday, Trump said China has started buying US
soybeans again. But officials in Beijing have been strategizing
to minimize reliance on US soybeans
since the start of the trade war. China has swapped
much of its demand to South America and away from the US, which
is now seeing record levels of soybean inventories. 

“At this juncture of deepening trade tensions, it is unlikely
that private traders in China would seek to buy US origin
soybeans,” JPMorgan analysts said in a recent research
note. 

Deutsche Bank

In July, the Trump administration unveiled $12 billion in
emergency aid to farmers who risked suffering financial losses
from its trade policies. Soybean farmers are poised to get a
large portion of the aid from the controversial plan. 

“The soybean is not just some small thing in the background,”
Torsten Sløk, chief international economist at Deutsche Bank,
said.

“It’s actually something that is pretty important overall for
what the agricultural sector is doing and in terms of where
revenue is coming from. That’s why we’re watching very carefully
whether soybean prices go up or down.”

With no clear end ito the trade war in sight, analysts say
there’s little chance of soybean prices recovering anytime soon.
Beijing cancelled high-level trade talks planned for this
week after another round of Trump’s tariffs on Chinese
imports took effect. And the longer tariffs are in place, the
more difficult regaining market share could be. 

“Even under a best-case scenario, ie, cease of the trade war, it
will be difficult to fully recover the prior extent of China’s
soybean import demand in our view,” JPMorgan wrote. 

Markets Insider