The Battle for Soybean Supremacy: How the U.S. Can Compete with Brazilian Agriculture

By. Teddy Headlee

DOI. 10.57912/31145164

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After beginning a crop modernization campaign over 50 years ago, Brazil has now established itself as an agricultural powerhouse with global reach. In addition to overall agriculture accounting for a fourth of its GDP and $149.9 billion in agricultural exports, Brazil’s share of global soybean exports has consistently surpassed the U.S. since 2017, growing from almost 43% to 57% between 2017 and 2023. Due to this substantial export growth, Brazilian crops are able to effectively compete with U.S. agricultural products, and the use of Brazilian soybeans by China as substitutes for U.S. imports during recent tariff disputes demonstrates how Brazil could replace the U.S. in other markets during periods of trade uncertainty. For U.S. agriculture to adapt to the long-term consequences of competition from Brazil’s agricultural sector, trade policymakers should prioritize strengthening foreign market access in the midst of current tariff uncertainty, promoting trade in new markets, and conducting investments in trade infrastructure necessary to solidify commercial ties.

Brazil’s current status as a major agricultural producer has its origins in a concerted effort to improve the country’s food security. Despite being a net food importer and recipient of food aid up until the 1980s, a combination of increased farming in the tropical savannah Cerrado region, a shift to growing soybeans, and a focus on improving the productivity of already used land has dramatically increased Brazilian crop yields. Also crucial to Brazil’s success has been its establishment of a network of public research centers under the Brazilian Agricultural Research Corporation (Embrapa), which has developed methods to improve soil quality, enhance pest resistance in crops, and develop crop varieties to address difficult growing conditions in the tropics. This expansion of Brazil’s agriculture sector has ensured that the country can meet its own food demand while also establishing it as a major crop exporter for the foreseeable future, with the USDA estimating that Brazil’s share of global soybean exports will grow from an already substantial 51% to almost 61% between 2021 and 2033.

Large increases in crop yields have already begun to support other industries in Brazil and alter international trade. Sugarcane and corn harvests have supported large biofuel industries while also helping Brazil recently become the second largest corn exporter behind the United States. For biofuels, Brazil now ranks as the world’s second largest ethanol producer, third largest biodiesel producer, and a potential supplier of sustainable aviation fuel. While ethanol production has varied from year to year, recent government efforts to increase the levels of ethanol in gasoline from 27% to 30% and biodiesel in diesel from 14% to 15% as part of a larger effort to hopefully increase ethanol and biodiesel levels to 35% and 25% respectively show that Brazil remains committed to the biofuel industry as a way to reduce carbon emissions and improve fuel self-sufficiency. In addition to boosting other sectors of the domestic economy, Brazilian agriculture has already established itself as an essential partner, solidifying trade relations with a number of partners. China, the EU, and the U.S. together make up 61% of Brazil’s overall agricultural exports, and South Korea, the U.S., and the Netherlands make up almost two-thirds of its ethanol exports. Consequently, Brazil has coupled its growing agricultural sector with new industries and foreign markets to meet increasing yields.

While Brazil has become a major agricultural supplier to several large trading partners, its largest and closest commercial relationship by far is with China. Port infrastructure investments throughout Latin America and Brazil have helped China establish a comprehensive trading relationship with Brazil for agricultural products, and programs like the “Soy China” initiative have further cemented trade links by ensuring that Brazilian soybean exports meet Chinese quality and sustainability standards. Thus, Brazil’s crop boom has helped foster other industries and stronger trade ties with other nations.

As a consequence of Brazil’s status as an agricultural powerhouse and exporter, U.S. farmers are also facing more competition on the global stage at a time of immense uncertainty from tariff disputes. Increasing Brazilian exports not only reduce American farmers’ potential income by cutting into U.S. exports, but they are also risk leading to long-term harm by replacing U.S. crops during ongoing trade disruptions. By October 2025, Brazil’s soybean exports had reached 102.2 million tons and already beaten annual totals for 2023 and 2024, as China refused to buy from American farmers due to the ongoing trade war. While China did eventually pledge to purchase 12 million metric tons (MMT) of U.S. soybeans in the last two months of 2025 and to increase purchases to 25 MMT each year through 2028, its failure to meet similar purchasing promises in the first Trump Administration’s Phase One Trade Deal raises the question of whether China will fulfill its promises this time. When considered in conjunction with Brazil’s already close infrastructure and export ties, recent trade disputes with China raise the possibility of U.S. farmers losing access to and being replaced in a market that accounts for around 56% of America’s soybean exports. In this context of reduced exports, limited market access, and increasing competition, U.S. trade policy must ensure that deeper trade ties are fostered with nations that can be long-term, stable trading partners for American crops. 

The most immediate action that can help American agricultural exports adapt to Brazilian competition is ensuring that recent trade deals keep tariffs lowered and maintain purchases of American crops. In addition to already negotiating trade deals to lower duties, the U.S. has also pursued a strategy of guaranteeing crop purchases in deals with Indonesia, Thailand, and Bangladesh. By continuing to push for lower tariff rates and more crop purchases, the U.S. can ensure that it has other markets to sell its products in to compensate for growing competition with Brazil. Moreover, by enforcing compliance to prevent another scenario similar to China’s refusal to meet the terms of the Phase One Trade Deal, the U.S. can guarantee that said markets will continue to purchase American goods.

In the longer term, the U.S. should prioritize finding new markets for exporting crops and deepening trade relations with existing partners. By expanding existing USDA programs such as  the Market Access Program, Emerging Markets Program, and the Technical Assistance Specialty Crops, the U.S. can improve marketing and address barriers to crop exports in other countries. In addition, coupling the existing Foreign Market Development Program that focuses on overcoming infrastructural and trade obstacles with broader investments from the Development Finance Corporation in foreign port, road, and rail infrastructure for transporting U.S. agricultural exports would help build the logistical requirements for increased levels of American exports while also establishing deeper commercial ties similar to those that Brazil and China have today.

Brazil’s rise as an agricultural superpower should ultimately be appreciated for the numerous benefits it can bring for the people of Brazil and the larger world. Careful investments in agriculture have brought greater food security to the country, improved global food supply, and increased the production of less carbon-intensive biofuels. However, Brazilian agriculture’s greater role on the world stage has also led to competition with American exports and risks displacing them in foreign markets. To ensure that American farmers can secure their place and benefit from global trade, the U.S. must prioritize lower tariffs, increasing guarantees of crop purchases, and improving market access and infrastructure in other nations. In doing so, the U.S., the world, and Brazil can all benefit from an expanding global agricultural trade system.