Soybeans jump from near decade-lows as US-China trade battle heats up

Soybeans climbed more than 2% on Friday. The US and China imposed $34 billion in tariffs on eachother. Follow soybean prices in real time here. Soybeans rose more than 2% Friday after President Donald Trump followed through with tariffs on $34 billion worth of Chinese goods, prompting in-kind retaliation from the world's largest soy importer. The tariff implementations mark the first material movements in a face-off between the world's largest economies  that has pushed soybean prices down nearly 20% since March, when the Trump administration announced plans to penalize China for what US officials found to be "unfair" trade practices. US duties, which target a range of Chinese products including technology imports, went into effect just after midnight Friday. Chinese officials quickly hit back with tariffs on hundreds of US products, including agricultural products and vehicles. The tariffs come at a time when US soybean farmers usually sell to China, according to Kevin McNew, chief economist at Farmers Business Network. He said China has bought about 2.5 million metric tons of soybeans on forward contracts he suspects will be cancelled. "Tariffs are never a good thing for American farmers," he said. "But this is a particularly difficult time for these to go into effect." The US shipped more soybeans than usual in May as markets poised for a trade war. Exports of the legume jumped by $2 billion from April, the Commerce Department said Friday. "The story presumably is that Chinese importers have been buying U.S. soy ahead of the imposition of tariffs - effective today - in retaliation for U.S. tariffs on Chinese goods," said Ian Shepardson, chief economist at Pantheon Macroeconomics.  But economists expect soybean exports to drop sharply in July. With about 90 million acres of soybeans grown in the US, McNew estimates the tariffs will cost American farmers as much as $3.5 billion.  There is no clear end to trade tensions in sight. The Trump administration is set to impose tariffs on $16 billion worth of additional goods as soon as August and has threatened to target another $200 billion worth of Chinese goods in the future.SEE ALSO: IT'S ON: Trump's trade war kicks off with tariffs on $34 billion worth of Chinese goods Join the conversation about this story » NOW WATCH: This glassblowing master sculpts incredibly realistic animals out of glass

More Headlines

Follow worldbiztoday on Twitter

US Stocks