China Leaves Soybeans Out of $30 Billion Tariff Deal

The U.S. and China agreed to move toward lower tariffs on $30 billion worth of goods in each direction—but China's list of 1,619 eligible U.S. products leaves out commodity soybeans, the raw crop at the heart of U.S.-China farm tensions.

The omission follows President Donald Trump's summit with Chinese leader Xi Jinping last week. Beijing's import list spans beef, seafood, cosmetics and medical gear. Seed soybeans, soybean flour and soybean processing by-products made the cut. Bulk commodity soybeans did not.

The exclusion is not a minor technicality. Soybeans are America's second-largest agricultural export after corn, with U.S. exports reaching $16.5 billion last year, according to the U.S. Department of Agriculture. China buys more soybeans than every other country because it has limited arable land.

That dependence has made the crop uniquely exposed to trade policy swings. Before the first Trump trade war in 2018, the American Soybean Association estimated 28% of all U.S. soybean production shipped to China. When Beijing slapped a 25% retaliatory tariff on U.S. soybeans that year, the USDA estimated farmers absorbed $9.4 billion in soybean losses—costing Iowa $1.2 billion and Illinois $1.3 billion.

The Midwest bears the brunt. Illinois and Iowa are the country's two largest soybean producers, followed by Minnesota, Indiana and Nebraska, with North and South Dakota, Missouri and Ohio also major growers. Because soybeans trade in export and national markets, weaker Chinese demand drives down the cash prices farmers receive at local grain facilities.

A history of dealmaking

Trump has made soybeans a centerpiece of his negotiations with Beijing before. In November, he struck a deal with Xi under which China committed to buying at least 25 million metric tons of soybeans in each of 2026, 2027 and 2028. After meeting Xi in May—the first visit to China by a U.S. president since 2017—the White House announced China had agreed to buy at least $17 billion in agricultural products on top of those soybean commitments.

Despite those pledges, China has an alternative supplier: Brazil.

Unlike products such as beef, whose quality varies by country of origin, bulk soybeans are interchangeable and end up crushed for livestock feed, according to Ker Gibbs, former president of the American Chamber of Commerce in Shanghai. "They go into pig feed, so it's not like the pigs are really gonna see a big difference between American soybeans and Brazilian soybeans," he told Fortune.

Brazil overtook the U.S. as China's largest soybean supplier more than a decade ago, and recent trade tensions have widened the gap. The USDA said 71% of China's soybean imports came from Brazil, and its agricultural attaché in Beijing reported last year that Brazil's share had continued to grow "at the expense of the United States," helped by cheaper prices.

"They definitely want to keep Brazil warm, and so they don't want to suddenly shift everything over to the U.S.," Gibbs said of China's decision to exclude commodity soybeans from the relief list. "They're leaving the door half closed."

Leverage for the next round

Leaving raw soybeans outside the tariff package also hands Beijing a holstered weapon, according to Usha Haley, a professor at Wichita State University who has studied Chinese trade strategy.

"That gives China a bargaining chip for subsequent talks, and, of course, this is about leverage," Haley told Fortune. "They offer enough to demonstrate that they are moving on things, that they are present, but they always hold something back economically and politically for the next round."

China does not need to stop buying U.S. soybeans entirely for that pressure to bite. It purchased 1 million tons of U.S. soybeans ahead of the Trump-Xi summit, Reuters reported.

"Commercial purchasing and negotiating leverage can operate simultaneously," Haley said. She added that China only has to keep access to its soybean market uncertain and expensive for farmers already operating on thin margins. "Uncertainty also has a cost."

For Midwest growers, the message from the summit is clear: even a headline $30 billion framework leaves their biggest crop on the negotiating table for whatever round comes next.