Ohio State University studied the potential impact of Chinese tariffs on corn and soybeans
By Diego Flammini
Staff Writer
Farms.com
Ohio corn and soybean farmers could be dealt a devastating blow if China imposes tariffs on U.S. imports.
Should China place 25 percent levies on American corn and soybeans, Ohio farmers could lose 59 percent of their net farm incomes, an Ohio State University (OSU) study says.
Researchers used data from six farms in the state to create and evaluate a farm representative of Ohio’s ag industry.
The research farm is a 1,100-acre operation from west central Ohio. The farm has a 50/50 corn and soybean rotation and averages yields of 154 bu/ac of corn and 49 bu/ac of soybeans.
Using a baseline estimated annual net income of US$63,577, a Chinese tariff could drop annual farm incomes to US$26,107, the study says.
“The biggest impact will be on profits from soybeans, however corn is affected too,” Ben Brown, manager of OSU’s College of Food, Agricultural and Environmental Sciences’ farm management program and author of the study, said in a release on Tuesday.
“There are farmers who are going to struggle across the state. If the proposed tariffs go into effect, we’re going to have farmers who will have to exit the industry.”
If China implements the tariffs, U.S. growers could find themselves with a surplus of soybeans.
No other market could replace the volume of soybeans China imports.
“China is so enormous as a market that it dwarfs all of the other major importers,” Ian Sheldon, an ag economist involved with the study, told Farms.com today. “The European Union, Japan and Mexico are just not as significant a market as China is. There’s no other market to pick up that slack as far as I can tell.”