Brent Swart, ISA president and farmer from Clay County, spoke about trade and exports. (Photo credit: Iowa Soybean Association/Mickayla Jordan)
ISA and Cargill join for roundtable discussion
March 20, 2025 | Kriss Nelson
During the fourth annual Iowa Soybean Association (ISA)-Cargill Roundtable in Sioux City last week, participants discussed subjects important to farmers, from bin management to biofuels.
State of Soy: Pricing, Quality, Uses and Markets
Brent Swart, ISA president and farmer from Clay County, gave insight into the effects trade and exports are having on the soybean industry.
“There have been many concerns regarding the implications of recent tariffs and making trade an uncertain reality for our industry,” says Swart. “Trade is extremely important to what we do as 50% of the soybeans we grow are going to be exported.”
Where are those soybeans going?
- China and Mexico have been the top two importers of U.S. soy.
- Mexico imported more than 8 million metric tons of soybeans in 2022-2023, of which 7.5 million metric tons came from the United States.
- China consumes nearly 60% of soybeans traded worldwide. More than 50% of U.S. soybean exports are destined for the Chinese export market with a value of $12 to $13 billion annually.
Although trade issues with China are not new, as Iowa soybean farmers, Swart says it is important we understand issues between the two countries need to be resolved.
“China needs a quality source of soybeans. Quality is the keyword for U.S. soybeans,” he says. “As U.S. soybean farmers, we need that export market.”
How do things differ now compared to when the 25% tariff was implemented in 2018?
“As China has shifted preference to Brazil, we have made a diligent effort as soybean farmers and trade organizations to expand and diversify our portfolio of customers with a highly reliable soybean supply and high-quality soybeans and soybean meal to other parts of the world,” says Swart.
The U.S. has diversified their soybean export portfolio to:
U.S. soy has 95% of the market share of soybeans.
403 thousand metric tons (TMT) of soybeans were consumed in the 2023-2024 marketing year.
Industries with the highest need for protein include aquaculture, livestock and tourism.
U.S. soy has 89% of the market share of soybeans.
600 TMT of soybeans were consumed in the marketing year 2023-2024.
Reasons for a high U.S. soy preference include amino acid profile, quality and sustainability.
Export challenges and opportunities
Travis Gerlach, Western soybean team lead for Cargill, warns vessel port fees could affect exports more than tariffs.
What could those implications mean?
- Farmers could see a “9” in front of soybean prices for the new crop year.
What can farmers do?
- Make sure you are vocal. Contact your state and federal government officials.
As far as opportunities, Gerlach says farmers should consider:
- 45Z tax credit could help soybean demand from a crush standpoint.
“We have got to get 45Z to the finish line,” he says. “45Z sets up domestic market for crush and helps solidify a domestic demand for the soybeans you are all supplying. We need that crush capacity.”
Navigating the Current Biofuels Landscape
Matt Herman, ISA chief officer of demand and advocacy, says there are a few incentives for biofuels.
1. Blends above B20
“Most states have biodiesel use incentives only to 20% blend. We have been getting some action the last few weeks for a retail incentive for B30. Fuel producers and retailers have been interested in testing and selling higher blends of fuels. As a state, we need to demonstrate a pilot program to make sure retailers are in a position to sell B30,” says Herman.
2. Renewable Volume Obligation (RVO)
The last RVO was set three years ago during the build out of the soybean crush industry and renewable diesel capacity was coming online.
According to Herman, the next RVO, planned for 2026, is the most important one we have ever had.
“The last three years we have significantly overproduced and the No. 1 thing to help increase the value of biodiesel is this RVO,” he says.
Pat Woerner, commercial lead for Cargill’s biodiesel business, sums up the current state of the biodiesel market as “difficult.”
Why?
- Federal tax credits were cut from $1 per gallon to 30-cents a gallon for biodiesel made using vegetable oil. This has caused a significant drop in biodiesel production, with January biodiesel production down 65 million gallons compared to 130 million gallons in January 2024.
“The industry is cut in half and this is tough times in the biodiesel supply chain,” says Woerner.
Could some of that capacity come back online? Woerner believes so.
“We still have an RVO to meet,” he says. “Buyers can get by with this lower rate for five months, but I think we will have to bring capacity back online, but we will have a long gap to get through.”
Grain Storage for Greater Returns
According to Ryan Thompson, strategic account manager with AGI, grain conditioning is a major component of grain bin storage management.
What are the aspects of grain conditioning?
- Good aeration system based on drying/cooling purpose
- Keep proper grain mass configuration:
Are you leaving grain peaked? Coring it? Is it in an inverted cone? The configuration of the grain makes a difference in how we can better condition the grain within the bin.
- Follow proper cooling and rewarming procedures to prevent issues like condensation within the bin as we move from winter to spring and summer.
- Knowledge of Equilibrium Moisture Content (EMC)
This determines the safe storage moisture content limit condition at 65% relative humidity (mold growth slows down at this relative humidity level); gives information, whether the grain, at the present condition, will absorb moisture at a specific temperature and relative humidity; determines the ambient condition that is suitable for drying or rehydration.
“All grain will equilibrate to a natural moisture content given to relative humidity in the atmosphere it is presented,” says Thompson. “You are trying to create the ideal atmosphere for that grain to be stored at. You should Identify that what the have a predetermined level that moisture of the grain should be at if you are looking to store this grain for a longer period of time.”
Farmers Connecting Supply with Demand
Mike Steenhoek, executive director of the Soy Transportation Coalition, presented a breakdown of the transportation challenges impacting the soybean industry, specifically, the Panama Canal.
There have been questions surrounding China’s involvement with the Panama Canal, and Steenhoek provided information related to the current debate.
There are three aspects being considered when it comes to China’s involvement with the Panama Canal:
- No. 1: What extent does the Chinese government influence the commercial activities in Panama?
Chinese involvement relates to two of the five ports in Panama, not the canal. One of the ports is on the Atlantic and the other on the Pacific side as well as a focus of a bridge that is being constructed by Chinese construction firms.
- No. 2: If there is significant Chinese influence, how does that impact the Panama Canal?
- No. 3: What, if any, is the extent that has occurred?
“Just because the United States built the Panama Canal it does not mean we can take it back,” says Steenhoek. “Nowhere in the treaty does that provide an opportunity for the U.S. to regain ownership of the canal. The most we can do, according to the treaty, is if the neutrality of the canal is in danger, we can intervene militarily to restore that neutrality so not one country is of benefit more than the other.”
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