D any rural road around Augusta, a small town in western Illinois, on an evening in October, and it seems as if the fields are wrapped in a low mist. In fact, it is dust flung up by combine harvesters. October is harvest season and they are hauling in billions of bushels of maize and soyabeans. Yet all is not well. Sitting in the cab of his combine harvester, Brady Holst, a 32-year-old who farms soya and maize (corn to Americans) on 3,500 acres around Augusta, explains the problem. "It used to be that farmers had to worry about the weather," he says. "It seems like now it's more policies or global events. Things like that change quickly and make things tough."
The global event worrying farmers right now is that China has stopped buying soyabeans. Last year Chinese buyers bought almost $13bn worth, representing around half of exports, or almost a quarter of the entire crop. By mid-September last year, Chinese buyers had ordered 6.5m tonnes of American soya. By the same date this year, with the buying season just getting started, and a 20% retaliatory tariff imposed by China on American imports, they have not made a single order. If China does not start buying soon it is going to be "very very challenging", says Todd Main of the Illinois Soybean Association, which represents farmers.
Mr Holst's farm is, in its way, a marvel of modern American industry. The combine harvesters, which are worth several hundred thousand dollars, are so efficient that he, his brother and his father can bring in the entire harvest on their own. A fleet of autonomous drones spray pesticides. Both the maize and the soya have undergone decades of research and genetic engineering to improve yield and quality. Once the harvest comes in, lorries carry it to the Mississippi, 20 miles away, and from there barges carry it down the river to Louisiana, to be loaded onto cargo ships.
But this efficiency also makes farms vulnerable. American farmers are far from diversified. And President Donald Trump has delivered quite a shock. China's retaliatory tariffs are just the start of the problem. While commodity prices are falling, input costs are rising, in part thanks to import tariffs. In more labour-intensive sectors, such as dairy, fresh produce and cattle farming, raids are disrupting the supply of workers.
Conditions are not yet as bad as they were during the 1980s farm crisis, says Beth Ford, the of Land O'Lakes, a large farm co-operative. Bankruptcies have risen sharply this year, but remain below pre-pandemic levels. Land prices are high, so farmers can get loans. But things could get worse quickly, she says. "When farmers approach lenders for financing the next crop year, that's when the real stress will show." Younger people are struggling to enter the industry -- more farmers are older than 75 than younger than 32.
The bigger risk even than bankruptcy, Ms Ford says, is that America loses its comparative advantage. In the past few years, the land used for soya and corn cultivation in Brazil has expanded by 40%. Chinese investment in new railways and ports means it is cheaper to get to market. And in Brazil's climate farmers can grow two crops a year. A prolonged trade war would only cause Brazilian competition to grow, and America's industry to shrink. Mr Main suggests hopefully that new markets can be found, and domestic uses for soya, such as making biofuels, will provide new demand. But that is all rather speculative for now.
What does this mean politically? In June Mr Trump said that he is "never going to do anything to hurt our farmers." Scott Bessent, the Treasury secretary, is expected to announce a bail-out shortly. What farmers want, however, is a deal with China, not a government handout. One thing that has particularly outraged them is that even as he promises help, Mr Bessent has also given a hand to the government of Javier Milei in Argentina with a $20bn swap line. In gratitude, Mr Milei removed the country's export tax on soyabeans, and China immediately bought 20 shiploads from Argentina. Relief may be coming, but don't bet the farm. ■
