U.S. soybean markets are nearing a critical inflection point, as trade uncertainty with China continues to depress futures and inflate stockpile projections. For Iowa farmer and Commstock Investments president Matthew Kruse, the warning signs are clear: without Chinese demand, prices could collapse to $8 per bushel, repeating the market shock of 2018.

"There's no replacement for Chinese demand," Kruse stated in a recent Ag Marketing IQ video. Historically, China has purchased 450 million to 1.3 billion bushels annually from the U.S. - a level of off-take no other market can replicate. "The rest of the world combined really can't make up that loss," he emphasized.

Amid harvest season preparations, the market faces a surplus without a home. Current USDA projections peg 2025-26 ending stocks at 310 million bushels, but Kruse and other analysts foresee an additional 500 million bushels of unsold supply if Chinese purchases don't materialize soon. That would push total ending stocks to 800 million bushels, not far from the 900 million-bushel glut in 2018, which drove prices down to $8.

Though trade progress has been noted with Japan and a tentative 90-day ceasefire with Mexico, the complex negotiations with China appear unlikely to resolve before late fall. That timing risks forcing a downward USDA export revision, further unsettling markets already sliding within a bearish price channel.

Kruse's outlook is sobering: "You're talking about 500 million bushels that I don't think there's a house for." The implications go beyond simple supply and demand mechanics. With global production stable and South American growers aggressively competing, the absence of China-which once absorbed nearly two-thirds of U.S. soy exports-leaves a gaping hole in the marketing equation.

This situation underscores the broader vulnerabilities in the U.S. soybean trade. Farmers may need to revisit marketing strategies, lock in current prices where possible, and prepare for potentially unprofitable margins if diplomatic solutions drag into winter.

The 2025-26 crop year, once hopeful amid strong yields and planting weather, may now hinge on international negotiations far beyond the control of producers. For farmers like Kruse, the only certainty is volatility.