China just placed its largest order of U.S. soybeans in two years, offering a sign of improving trade conditions after months of China snubbing American soybean farmers.
“We want to trust what we’ve heard,” Todd Main, the director of market development at the Illinois Soybean Association, told Fortune.
At the same time, farmers are fed up with the uncertainty that has unaccompanied the trade policy of the Trump administration.
“We are concerned about the volatility in the trade relationships,” Main continued. “It’s hard for people to make plans—whether that’s farmers planning for next year’s crop, or buyers that are planning to make big investments in equipment or facilities or what have you—where there’s lots of instability.”
The threat of future trade tensions hasn’t completely disappeared. The consequences of reopened tariff disputes between the U.S. and China would mean Brazil and Argentina would once again have another opportunity to expand their dominion over China’s soybean import market.
“Brazil is the largest producer and exporter of soybeans, and so the real concern has been, if we have another trade war, we’re incentivizing faster expansion in South America, which has long-run effects for us,” Scott Gerlt, chief economist for the American Soybean Association, told Fortune.
“It’s not going to be just, OK, everything’s all better—or, everything’s a disaster,” Main said. “It’s going to be somewhere in between going forward.”
