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Severe impact on soybean tariff for Michigan farmers

Wednesday morning, China announced more than 100 new tariffs on U.S. products like soybeans, cars, planes and orange juice. It's a response to President Trump's tariffs on $50 billion of Chinese goods.
Credit: ThinkStock
Image of soybeans.

HAMILTON, Mich. — The tariff's impact can be felt in our state. Michigan is one of the top soybean-producing states in the country, with more than two million acres of production just last year.

Soybeans are America's leading agricultural export, with sales around $23 billion last year alone. China is the top market for our country's soybeans, but we're not theirs. The U.S. is second to Brazil in soybean exports to China and since Brazil doesn't have a tariff in place on it's product, the choice for China is an easy one.

Growing soybeans runs in Steve Koeman's family, which is why the tariff is a big blow.

"It's certainly not going to allow us many soybeans to China with a 25 percent tariff, it's just going to put us out of the market," Koeman Farms owner Steve Koeman said.

China imported $14 billion worth of soybeans from the U.S. last year.

"We produce about a 104 million bushels of soybean in the state of Michigan, it's still a big product, we have 2.3 million acres of soybean in Michigan that we grow locally here, so it's going to certainly make a big impact statewide and nationwide," Koeman said.

Koeman said it's a bad situation for farmers across the board, considering the already imposed tariff on steel.

"This seems to be retaliation or a tit for tat with the trades so we put a tariff on china's steel, they're going to put a tariff on something," Koeman said. "We're in a lose lose situation as farmers right now because we buy a lot of equipment, we buy a lot of steel so the steel coming to us, is going to cost us more."

Half of the U.S.'s soybean production go to export, a third of that goes directly to China.

"Soybeans is the number one commodity that comes out of the U.S. that goes into China, it's a $14 billion a year product for us, we sell $14 billion to China alone," Koeman said.

Koeman said the U.S. is now at a severe disadvantage.

"We can't just add prices to it, I would love to - just say 'Well I think my soybeans are worth $14 a bushel and that's what I'm going to sell it for', in a commodity market it doesn't work that way," Koeman said.

Soybeans contribute $1.76 billion to the Michigan economy, and more than 14,000 jobs.

The American Soybean Association along with other agricultural activists are asking President Trump for a meeting to reduce the trade deficit by increasing competition rather than creating barriers to international markets.

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