Tarrifs & Basis: North Dakota
Recently, tariffs and their impact on grain markets have been a hot topic of discussion. However, one crucial factor that often gets overlooked is basis—and how it directly affects farmers. During the last trade war, I was at the elevator and watched as new crop bids disappeared, leaving us scrambling for solutions. While the U.S. managed to find alternative trade partners and narrow the basis gap, it still lagged behind historical levels.
The Tariff Effect on Soybeans & Corn
When the first tariff announcement hit, there was a chatter that soybean bids disappeared overnight. However, the exporters I follow had already stopped posting bids three weeks prior.
Each March, PNW bids typically vanish as the South American harvest takes over.
The timing varies each year, usually between February and April, depending on crop size and harvest progress in South America.
While tariffs contributed to uncertainty, seasonal factors played a bigger role in bid fluctuations.
Corn, on the other hand, has been a different story. Despite concerns over potential Mexico tariffs, corn bids have remained relatively steady in recent months. Instead of tariffs, the biggest factors impacting basis have been:
Rail performance and logistics challenges.
Freight costs, particularly the price of railcars.
North Dakota’s Unique Position
North Dakota is in a slightly different position than other regions, thanks to the addition of two new soybean crush facilities that now handle nearly 50% of the state’s soybean crop. This shift has softened the impact of tariffs by creating a more stable local demand.
New crush demand and established trade partners should help stabilize basis.
A smoother transition is expected compared to past trade disruptions.
Farmers won’t have to scramble to find buyers for soybeans.
Key Takeaways
✔️ Soybean bids disappearing wasn’t just about tariffs—seasonal trends and global competition played a major role.
✔️ Corn bids remained stable, with freight costs and rail logistics having a bigger impact than tariffs.
✔️ North Dakota farmers are in a stronger position due to new crush facilities, which account for half the state’s soybean crop.
✔️ Historical basis values should still be closely monitored, especially for bushels that need to move at harvest.
Uncertainty remains, but a proactive marketing approach will be key in the months ahead.
Alex Andel
Basis and Freight | Market Advisor, Northern Plains
As our basis and freight expert, Alex assesses current market conditions and forecasts future scenarios. His keen insights create transparency in the cash market, resulting in significant returns for our clients.
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