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Impacts of Chinese Soybean Tariffs on Financial Position of Central Illinois Grain Farms

Recent events suggest a possibility that China will place a 25% tariff on soybean exports from the United States to China. What effect would this have on soybean prices and farms? Krista Swanson, Gray Schnitkey, Todd Hubbs, Johnathan Coppess and Nick Paulson from the U of I Dept. of Agricultural and Consumer Economics weigh in with their latest article on farmdoc Daily.

"Such a tariff would result in lower soybean prices and have numerous price and cost effects. We evaluate these impacts on the 2018-2021 financial performance of an average 1,700 acre grain farm located in central Illinois. Our analysis indicates a 25% tariff would result in a significant deterioration in cash flow. An attendant 20% farmland price decline would result in over a $500,000 decline in the farm's net worth by 2021."

For the full story and analysis see this Farmdoc Daily article: