There is plenty of nervousness over how the ongoing trade war between the U.S. and China will continue to affect North Dakota farmers.
Soybeans have been hit hard as international markets are compromised because of trade negotiations and tariffs to countries that traditionally are big buyers of North Dakota soybeans. China is the biggest buyer of U.S. soybeans, so tariffs have affected markets state growers have come to rely on.
Farmers are the eternal optimists. Otherwise, what is the point of farming? asked Colfax farmer Scott Gauslow Tuesday morning as he helped host 17 Philippine soybean buyers at Colfax Farmers Elevator. The delegation then made their way to a nearby farm owned by Vanessa and Paul Kummer to see the growing process.
Many Richland County farmers are looking at a big soybean crop — one that likely will spend a lot of time in storage as farmers are predicted to hold onto this year’s crop to await better prices.
Gauslow plans to roll the dice this year and store this year’s crop, anything that isn’t contracted.
“I don’t want to give my soybeans away. Why would I want to do that?” he asked.
Hot and windy weather last week helped finish Richland County’s soybean crop, a perfect mix of hot and dry. Some early area farmers combined mid-week. Wednesday evening a few dust clouds rose high in the air as farmers plucked soybeans from the field. This was sporadic as the full-blown harvest isn’t expected until sometime this week.
Todd Dravland, manager at Lidgerwood Farmers Co-op Elevator said Thursday morning it was still early to know yields since only two fields were completely combined. Those farmers reported soybean yields of 41 and 53 bushels per acre.
Jim Dotzenrod, a Wyndmere farmer running for North Dakota Agriculture Commissioner, said soybean prices have already dropped to a 10-year low. He calls for better negotiations since tariff wars have become so problematic for North Dakota farmers.
Thursday morning’s November cash bids for soybeans were about $6.80. Dotzenrod said the break-even point for many farmers is $9 a bushel, so farmers will not make a profit on this year’s crop.
In late August top Trump administration officials urged representatives of North Dakota’s farmers and ranchers to hang tough in coming months, saying battles over trade with the European Union, China, Canada, Mexico and other countries can be won with patience and resolve.
Then Thursday morning, China welcomed an offer from the Trump administration to talk trade despite a U.S. threat to impose steep new tariffs on a huge range of Chinese goods. The possibility of renewed high-level talks comes as the trade war appears ready to intensify. President Donald Trump said recently that new tariffs on $200 billion of Chinese goods could go into effect “very soon” and warned that another, even bigger wave of measures is “ready to go on short notice if I want.”
In the midst of this uncertainty the North Dakota Soybean Council hosted soybean buyers from the Philippines to visit farms across the state and see what their product goes through from start to finish.
Tuesday morning buyers toured farms in Colfax and Casselton, then ended the day with a brief economic lesson at North Dakota State University at Fargo.
Gauslow is a longtime soybean farmer who has been part of trade missions to other countries. Having Philippine buyers here comes at a perfect time considering the instability of soybean markets in the face of the ongoing trade war.
“It’s just a great opportunity to show off our product and quality soybeans. It’s an opportunity to get one-on-one contact with these guys. It’s wonderful,” Gauslow said.
He’s frustrated by the erosion of markets in China he helped create, having been part of North Dakota trade delegations that visited there in prior years. He worries those markets will be permanently compromised.
Craig Pietig, director of exports for AGP, a leading agribusiness that processes and markets oilseeds, grains, and related products, was part of the tour. He said when times are tough, hosting foreign buyers is critical and can create an edge with competitors. When buyers see the quality first hand and get a chance to visit the farmers and elevators, it bolsters trade relationships, he said.
“It’s no different if you are selling grain or soybean meal at distilleries or selling cars down the street — it’s all about relationships, who you trust knowing they will get a competitive price and a quality product when they need it. This is a system we have done over the years that has proven itself,” Pietig added.
The tour started a week ago. The group has also been through South Dakota and Minnesota to see every step of the process.
“This is one program that we do throughout the year for marketing our soybeans. We like to bring over our partners from other countries and show them what we’re doing here,” said Harrison Weber, director of market development with the North Dakota Soybean Council.
By the end of fall, the Soybean Council will have hosted 80 companies from 14 different countries. Some markets are already established, while others are new, such as the South Koreans here three weeks ago, Weber said.