As the 2025 harvest season ramps up, American farmers are poised for another record year in corn and soybean production. The United States Department of Agriculture (USDA) projects corn output at 16.8 billion bushels, a 13 percent increase from the previous year, driven by favorable yields averaging 186.7 bushels per acre. Soybean production is forecasted at 4.301 billion bushels, maintaining strong levels despite some downward adjustments from earlier estimates. This bumper crop underscores the efficiency of US agriculture, but it also highlights vulnerabilities in a global market shaped by trade tensions, shifting demands, and policy needs. With abundant supply, the key question is where these crops will find their markets, from domestic uses to international outlets.
The China Challenge: A Shrinking Soybean Market
One of the biggest hurdles for US soybeans is the declining demand from China, the world’s largest importer. Historically, China has been a top buyer of American soybeans, but in 2025, US farmers are missing out on billions in sales midway through the peak season. From January to July, China imported 42.26 million tons from Brazil compared to just 16.57 million tons from the US. Overall, US soybean exports to China for the marketing year ending August totaled 22.9 million tons, a significant drop that leaves stockpiles piling up stateside.
This shift stems from China’s diversification strategy, investing heavily in Brazilian infrastructure to secure alternative supplies. Without Chinese demand, the abundant US harvest threatens to depress prices further, with some farmers facing soybean values as low as $8 per bushel. A 2,300-acre soybean operation, for instance, projects a $400,000 loss this year due to unsold crops destined for Asia. The situation is dire, as one farmer noted ahead of harvest: “We’re in a very dire situation with zero soybean sales to China.”
Tariffs: Trade Barriers Weighing on Exports
Exacerbating the China issue are escalating tariffs that continue to disrupt agricultural trade. US agricultural exports to China plummeted nearly 40 percent between June 2024 and June 2025, with soybeans bearing the brunt. China imposed a 15 percent tariff on US soybeans and other products in March 2025, later expanding to a 10 percent levy on additional items by May. Combined with 20 percent retaliatory tariffs, value-added taxes, and most-favored-nation duties, the effective rate on US soybeans now reaches 34 percent.
These barriers not only reduce competitiveness but also ripple through the farm economy. Fertilizer, tractor, and equipment prices are rising due to broader tariff effects, squeezing margins for producers. The Trump administration is considering economic aid for farmers this fall to mitigate the fallout, but ongoing trade negotiations remain uncertain. As tariffs persist, US farmers are left navigating a landscape where export opportunities to key markets are increasingly limited.
Biofuels: A Domestic Lifeline for Corn and Soy
Amid export woes, domestic biofuels offer a bright spot for absorbing surplus production. Corn’s primary biofuel use, ethanol, is seeing robust demand, with total US corn use for 2025-26 forecasted at 16.1 billion bushels, including a record 3 billion bushels for exports but strong ethanol contributions. Ethanol production is projected to consume a significant portion, supported by ongoing policy pushes.
For soybeans, biodiesel and renewable diesel are gaining traction. The Environmental Protection Agency (EPA) recently proposed increasing biomass-based diesel volumes from 3.35 billion gallons in 2025 to 5.61 billion gallons in 2026, marking a major win for soy-based fuels. Soybean oil biofuel consumption, though low earlier in 2025, stands to grow with these mandates. However, a White House review of biofuel waiver plans pits farmers against oil refiners, creating uncertainty. If resolved favorably, biofuels could help balance supply by diverting more soybeans and corn into renewable energy, stabilizing prices and providing a hedge against export losses.
Livestock Feed: Steady but Insufficient Demand
Livestock production provides another critical outlet, particularly for corn as feed. US animal feed demand has held steady through mid-2025, despite adjustments in cattle and hog herds and shifts in poultry. The USDA raised feed and residual corn use by 250 million bushels to 5.75 billion for 2025-26, reflecting resilient domestic consumption. Soybeans also play a key role in meal for animal rations, with crush projections at 2.49 billion bushels.
Yet, this demand may not fully offset the bumper crop. With soybean ending stocks tightening to 295 million bushels, and corn carryover also constrained, livestock alone cannot absorb the excess without price pressure. Herd sizes are stabilizing, but global competition and feed efficiency improvements limit upside. Overall, while livestock supports about 40 percent of corn use, it underscores the need for diversified markets to prevent oversupply.
A New Farm Bill: Safeguarding Farmers from Overproduction
The incentives that have made US farmers masters of corn and soybean production now risk their financial stability amid market gluts. A new farm bill, set for reauthorization in 2025 after extensions of the 2018 version, must address this by bolstering the safety net. Proposals include boosting crop insurance premiums, which cover risks from low prices and yields, and enhancing revenue protection programs.
To prevent farmers from going under, the bill could expand conservation incentives for crop rotation and diversification, reducing reliance on monoculture. Tax relief for equipment and investments, along with $56.6 billion in additional farm program funding, would strengthen resilience. Support for beginning farmers, nutrition programs, and trade promotion could open new avenues, such as biofuels mandates and international market development. By prioritizing these, Congress can ensure that American growers’ productivity translates to prosperity, not peril.
In summary, the 2025 bumper crop of corn and soybeans holds promise but demands adaptive strategies. From biofuels and livestock to policy reforms, the path forward lies in balancing domestic strengths with global realities.
Resources
- USDA Forecasts US Corn Production Up, Soybean and Cotton Down (nass.usda.gov, September 12, 2025)
- Corn, Soybean Markets See ‘Sell the Rumor, Buy the Fact’ on USDA Data (finance.yahoo.com, September 16, 2025)
- US Misses Out on Billions of Dollars of China Soybean Sales (reuters.com, September 10, 2025)
- Soybeans Without a Buyer: The Export Gap Hurting US Farms (soygrowers.com, August 20, 2025)
- Tariff Escalations Trigger Another Decline in US Farm Exports to China (investigatemidwest.org, August 25, 2025)
- How Tariffs Are Impacting Farmers in America’s Heartland (cnbc.com, September 16, 2025)
- Soy-based Biofuels Score Two Wins (incornandsoy.org, July 19, 2025)
- White House Review of Biofuel Waiver Plan (reuters.com, September 5, 2025)
- World Agricultural Supply and Demand Estimates (usda.gov, August 12, 2025)
- US Feed Demand Steady Amid Livestock Adjustments (grainjournal.com, June 12, 2025)
- One Big Beautiful Bill Act: Agricultural Provisions (fb.org, June 4, 2025)
- The Latest Updates on the Farm Bill (farmaid.org, July 22, 2025)