Oversupply of Soybeans
From the Ag Information Network, I’m Bob Larson. Multiple countries brought in large grain harvests during recent growing seasons.
While that’s normally good news, Tanner Ehmke, the lead economist for grains and oilseeds at CoBank, says the large crops combined with trade tensions have led to excess grain supplies around the world …
EHMKE … “A high level, first of all, across the entire grain and oilsseed space, really, the theme is oversupply. We've had record crops here in the U.S. We've got a record crop forthcoming in South America. We've had record crops and record yields all over the world, really.”
When that happens, Ehmke says the supplies really start to back up …
EHMKE … “And so, trying to find new markets is of the utmost importance. That's a challenge, obviously, when we have trade uncertainty.”
And nowhere has that been more evident in the past year or so, Ehmke says than with China …
EHMKE … “The trade war that we've had recently with China upended a lot of our exports, particularly for soybeans and also other commodities like grain sorghum, which are highly dependent on the Chinese market, and other specialty crops. But really, soybeans are the high-dollar export. That's the number one export from the U.S. over to China.”
Ehmke says a lot of industry speculation revolves around what the future trade relationship between China and the U.S. is going to look like.
