Phase One Signing a Boost for North Dakota Soybean Farmers

January 15, 2020

(Fargo, N.D.) Today’s long-awaited signing of a Phase 1 trade deal between the United States and China is being hailed as a positive step for agriculture, including for North Dakota soybean farmers hit hard by trade tariffs. Prior to a nearly two-year long trade conflict with China, more than 70 percent of North Dakota’s annual soybean production had been exported through the Pacific Northwest, most bound for China.

Growers leaders are pleased the two nations have reached an agreement to de-escalate a trade war that harmed the agriculture economy and soybean farmers for the last two years. The signing is welcomed as a step towards improved two-way trade between the U.S. and China that will hopefully reestablish strong soybean exports to China.

“It’s a good day because this agreement gets things started again and we need China for our exports,” says Joe Ericson, a farmer from Wimbledon and North Dakota Soybean Growers Association President. “It’s big for us and for farmers around the state to get beans rolling again.”

China will purchase and import on average at least $40 billion of U.S. food, agricultural, and seafood products annually for a total of at least $80 billion over the next two years. Products will cover the full range of U.S. food, agricultural, and seafood products. The Phase 1 agreement also offers resolution to non-tariff barriers including promising language on agriculture biotechnology, sanitary and phytosanitary issues, and intellectual property rights, among other areas.

China has agreed to implement a transparent, predictable, efficient, science- and risk-based regulatory process for the evaluation and authorization of agricultural biotechnology products. This language has the potential to significantly reduce the time it takes to reach approval of new traits in China, thereby allowing U.S. farmers to utilize traits that help combat a host of challenges.

Soybean growers remain concerned that the Phase 1 deal does not include an official commitment by China to remove the harmful retaliatory tariff on U.S. soybeans. Growers are hopeful that a mechanism will be applied to allow soybeans to be exported to China, industry leaders remain concerned that without the formal removal of the tariff, it will be difficult to ensure open market access with China into the future.  The American Soybean Association (ASA) urges the U.S. and China to include full removal of agriculture tariffs immediately.

“This will hopefully pave the way for the next phase,” Ericson adds. “We know that more issues need to be worked out, but this agreement will hopefully lead to more agreements.”

The North Dakota Soybean Growers Association is a statewide, not-for-profit, member-driven organization. We exist to conduct legislative activities in Bismarck and Washington, D.C. to improve the sustainable prosperity of its members and the entire soybean industry. The North Dakota organization is one of 26 soybean-producing states affiliated with the American Soybean Association.