After several years of strained trade, South Dakota soybean farmers are welcoming China’s return to the U.S. market under a new agreement that has restarted large-scale soybean purchases.
Coming into early September, China had still not purchased U.S. soybeans, but that changed when a deal was finalized committing China to buy at least 12 million metric tons of U.S. soybeans by the end of 2025 and 25 million tons annually through 2028.
For comparison, China purchased 26.8 million metric tons from the U.S. in 2024.
The renewed demand offers relief following seasons of low prices and uncertainty, though producers and economists say they remain careful about future volatility.
“This is a welcome change,” said Jerry Schmitz, executive director of the South Dakota Soybean Research and Promotion Council and the South Dakota Soybean Association. “The economy has been getting tougher. Input prices have gone up significantly, but crop prices haven’t, so any improvement in the market helps.”
South Dakota farmers planted about 5.2 million acres of soybeans in 2025, Schmitz said. The crop provides an estimated $3 billion to $5 billion each year in income for the state before it is processed into feed, oil or biofuel products.
For producers, China’s renewed buying marks a major shift after years of lost sales. Professor Elijah Kosse of the South Dakota State University Agricultural Economics Department said the downturn that began in 2018 forced farmers and grain organizations to find alternative markets.
“China had been moving away from buying our soybeans for quite a while,” Kosse said. “When China doesn’t buy, the price falls, and that’s an immediate negative impact on farmers.”
Kosse said South Dakota and other states adapted by exporting to more countries in Asia and by developing local processing facilities. He pointed to a new soybean-crushing plant in Mitchell built to help counter lower export demand.
“The basic bean isn’t worth very much,” Kosse said. “People want to buy the oil and the feed. We’ve created facilities where we can crush the soybeans ourselves to add value here.”
Even with China purchasing again, both Kosse and Schmitz said the state’s efforts to expand processing and diversify buyers will continue. Schmitz said soybean leaders have promoted South Dakota’s crop worldwide to attract new interest.
“We share that our soybeans are some of the best quality in the world,” Schmitz said. “Our weather gives them a natural refrigeration cycle in the winter, which helps maintain quality better than in warmer areas.”
Schmitz added that South Dakota soybeans generally contain higher amino-acid levels, making them desirable for feed production because buyers need fewer synthetic additives. He said those characteristics have drawn interest from Southeast Asian nations, which can ship directly from the Pacific Northwest at lower transportation costs.
While China’s renewed imports are expected to strengthen prices, Kosse said long-term trends still show the U.S. relying more on other suppliers.
“Even if all the tariffs disappeared, China probably still wouldn’t be buying as many of our soybeans as before,” Kosse said. “They don’t want to be reliant on the U.S., so they’ve looked for other producers.”
Still, Kosse said China’s return is significant for South Dakota farmers.
“China tends to pay a premium,” he said. “Its return could temporarily improve farm income.”
South Dakota Farm Bureau president Scott VanderWal said many producers are grateful for the agreement, but know its success depends on follow-through.
“They’re just thankful and hopeful that it works out,” VanderWal said. “The Chinese market is really tough, and you never know for sure if they’re going to take them until they’re actually delivered.”
VanderWal said that while yields this year were mixed, renewed Chinese demand has helped lift prices slightly.
“Soybean yields are OK, not as good relative to corn,” he said. “Just since President Trump signed the deal with China, prices have come up quite significantly, but really not to profitable levels yet. But at least it helps.”
He added that farmers may begin adjusting marketing strategies if exports remain steady.
“Hopefully, if we get some trade agreements in place and get the market for soybeans back up, that’ll increase the production of soybeans a little bit,” VanderWal said.
Still, he cautioned against depending too heavily on a single buyer.
“That’s what caused this whole thing – because we were so reliant on China for our soybean exports,” VanderWal said. “We continue in the Farm Bureau to urge the administration to look for varied markets, expand other markets, look for new ones and not just depend upon the Chinese market to sell soybeans.”
VanderWal said new processing investments, including the Mitchell plant expected to produce renewable diesel, could strengthen the state’s long-term soybean economy.
“We hope that getting into that fuel market with renewable diesel will be a good thing,” he said. “They say that fuel won’t gel up like the old biodiesel did.”
Both VanderWal and Schmitz said that broadening domestic uses and international buyers will be key to stability.
“We’re glad to see China buying again,” Schmitz said. “But our strength will come from building more markets and keeping our soybeans competitive everywhere.”
