Reliable trade partners are hard to find.
The attempt by the U.S. from 2018 to 2020 and since 2025 to rebalance the global trading system further in its favor has resulted in a general questioning of whether Washington is a reliable partner.
The shift has caused those trade partners to look elsewhere to find what they need.
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That condition is perhaps nowhere better observed than in American soy production, which has been losing global market share as new trade policies have taken hold.
In some respects, Washington is repeating the policy choices of President Richard Nixon just over half a century ago to curb inflation and to protect U.S. producers.
Now, like then, the policy was aimed at a rising Asian economy, with the result empowering agriculture production in Brazil.
That 70s show
The embargo was particularly injurious for Japan, whose diet depended on soy from the United States, which was its major trading partner, its investment partner and strategic ally.
Although the embargo was soon rescinded, the embargo left a bad taste among Japanese clients who realized that the U.S. might no longer be a reliable partner.
Perhaps more important was that Nixon so infuriated Tokyo that in response Japan made prodigious investments in Brazil to curate an alternative to American soy, allowing Brasilia to rise as a global agricultural competitor.
Just as in the 1970s, similar actions today are coming back to bite the U.S. soy community.
A sea change in the global production of soybeans…
The U.S. agricultural sector is no longer the largest producer of soybeans. The slide accelerated in 2013 when a U.S. drought pushed Brazil to the top, according to the Department of Agriculture.
In 2006, the U.S. held a 36% share of global soybean production, according to data supplied by the Soybean Processors Association of India. That share has been whittled down to 28% in the 2025-26 growing season.
By comparison, Brazil held a 26% share in 2006, which is now 41%, most likely because China—the target of recent U.S. trade policy—looked elsewhere for soy.
…and their export
A report from the USDA in 2023 found soybeans and their byproducts—soybean meal and oil—to be the most traded agricultural commodity.
Brazil is now the world’s largest soybean producer and exporter, with the United States and Brazil jointly supplying 83% of soybean exports to the world, according to the USDA.
Note that exports of whole soybeans can be inflated if the exporter does not have access to domestic processing equipment and needs to send its crop to another country. For instance, Paraguay exports its soybeans for refining elsewhere.
Soybean meal production
Soybean meal is a byproduct of soy oil extraction and is a fertilizer ingredient for agriculture and a protein source in animal feed.
China has become the largest producer of soybean meal, growing from its 19% share of global soybean meal production to 30%. The U.S. went from producing 26% in 2006 to 19% today.
Soybean meal exports
The combined exports of soybean meal from Argentina and Brazil now account for two-thirds of global soybean meal exports. Brazil’s share has grown from 25% to 29%; the U.S. share has grown from 14% of total exports to 20% in 2026.
The takeaway
Two attempts to reshape global trade in favor of the U.S. resulted in the long-term decline in its share of soy exports.
The U.S. share of global soybean production and exports has been dropping for 20 years, with the impetus for that decline coming from the 2018 and 2025 attempts to dictate the buying and selling habits of U.S. trading partners.
Source: realeconomy.rsmus.com
