The Impact of the Sino-US Trade War on International Soybean Trade

The Sino-U.S. trade war from the 2018-2021 years disrupted international agricultural trade. This study aims to understand how these trade tensions have affected soybean trade, especially China's response strategies and the resulting price changes. The research is motivated by the trade conflicts between the world's largest economies, the United States and China. Tariffs were applied on agricultural goods, including soybeans, causing disruptions in established trade routes and market dynamics. In response, China also applied tariffs on U.S. products, and sought alternative suppliers to cushion the impact of the tariffs. This strategic shift in procurement helped stabilize domestic soybean prices, countering the expected price fluctuations during the trade war. The study uses a series of regression models to analyze how the prices of soybean substitutes change in response to changes in trade patterns caused by the trade war. By studying the relationship between the prices of substitutes goods and market changes, we gain insight into how changes in trade policy affect commodity prices. We find limited significance in price changes for these soybean substitutes due to trade policies, suggesting the Chinese government’s swift response was able to combat potential disruptions.