U.S. farmers are planning to plant more corn and less soybeans this spring compared to last year to increase profits and offset the impact of the tariff war, according to growers and analysts.
Agricultural economists Frayne Olson from North Dakota State University and Chad Hart from Iowa State University noted that corn is winning the battle for acreage based on relative profitability. They indicated that corn is currently the best path to profitability in 2025 due to the falling prices of soybeans and other crops.
Both corn and soybeans are essential for animal feed, cooking oil, and renewable fuels. The United States is the largest exporter of corn globally and the second-largest soybean supplier after Brazil.
Planting decisions are usually made during the winter to forecast yields of the two major crops, corn and soybeans. However, this year is an exception due to predictions of record low global corn stocks, prompting increased corn production in the U.S. to replenish inventories and provide more grains for global buyers.
Despite the overall decrease in crop income for the third consecutive year, the USDA anticipates that farmers in 2025 will still make profits mainly due to government assistance.
Economists pointed out that with low prices for corn, soybeans, wheat, and cotton, U.S. farmers may find it challenging to achieve significant profits from any single crop. Farmers like Eric Kroupa in South Dakota are focusing on minimizing losses when deciding which crops to plant.
Recent rebounds in corn futures prices suggest increased profitability for growers. The benchmark corn futures at the Chicago Board of Trade rose above $5 per bushel, signaling better economic returns for farmers.
The Trump administration’s tariffs on corn imports may enhance the competitiveness of U.S.-produced corn but could impact soybean planting. China, the world’s largest buyer of soybeans, has diversified its corn sources, while trade tensions continue to affect U.S. agricultural exports.
As the U.S.-China trade disputes persist, Brazil is expected to supply 58% of the global soybean exports this sales year, surpassing the U.S.’s share of 27%.
Farmers typically make planting decisions in winter for the spring planting season, but this year some are delaying decisions due to low prices and trade uncertainties. Nancy Johnson, executive director of the North Dakota Soybean Growers Association, mentioned that many farmers are postponing decisions to assess evolving circumstances.
The ongoing trade friction is a continuation of the 2018 U.S.-China trade war, following which China shifted more of its soybean and corn purchases to Brazil.
The uncertainty in the market has led some growers to hold off on planting decisions, awaiting developments closer to the planting season in April and May, prompting a cautious approach among farmers.
(Author: Translated and rewritten from a report by Reuters)