Brazil, long viewed as the 800-pound gorilla in global grain trade, is poised to get even bigger-and that has U.S. farmers on edge.

At the Farm Progress Show 2025 in Decatur, Illinois, panelists discussed Brazil's growing dominance in the corn and soybean markets, particularly as trade tensions continue to strain U.S. agricultural relations with China, the world's top soybean importer.

"Brazil continues to expand area and production," said Matthew Kruse, an Iowa grower who also operates farmland in Brazil. Speaking during the show's kickoff panel, "Brazil vs. the USA in the Global Grain Game," Kruse warned that Brazil's output shows no signs of slowing.

China Shifts Its Buying Power South
This year, Brazil's massive soybean harvest is reshaping global trade flows. According to customs data, China imported 10.62 million metric tons (MMT) of soybeans from Brazil in June-87% of total imports and a 9.2% increase from a year ago. While U.S. exports to China also rose-by 13% to 1.58 MMT-the gap remains wide.

Typically, as U.S. harvest season approaches, China shifts to sourcing fresh soybeans from American producers. But in 2025, amid ongoing friction between Beijing and the Trump Administration, China has yet to commit to a single bushel of new-crop U.S. soybeans.

That's a red flag for the American ag sector, Kruse said, noting that China once purchased 1 billion bushels of U.S. soybeans annually.

"China is trying to send a message," he said. "They don't want to buy everything from Brazil, but they're looking for leverage. If we had competitively priced beans, I believe they would buy from us."

A Record-Breaking Horizon for Brazil
Meanwhile, Brazil is gearing up for another record crop year. AgResource, a U.S.-based consultancy, estimates the 2025-26 Brazilian soybean harvest at 176.5 MMT (6.48 billion bushels)-surpassing USDA's current projection of 175 MMT. The country's planted soybean area is expected to increase 2% to 120.3 million acres, the smallest annual growth in five years but still expanding.

Brazil already posted a record 2024-25 harvest at 169 MMT (6.21 billion bushels), while Argentina produced 50.9 MMT, a 5.6% year-over-year increase.

Cesar Cruz, director of research at Advance Trading Inc., said Brazil still has room to grow by converting pastureland to cropland, though environmental restrictions on deforestation could slow expansion.

Tariffs: The Unpredictable Variable
As for the near-term outlook, tariffs remain a wildcard. Earlier this year, China's import duty on U.S. soybeans stood at 44%, but was reduced to 10% following a recent trade "truce." However, market watchers caution that renewed volatility could quickly shift purchasing patterns.

This dynamic highlights the strategic vulnerabilities of U.S. agriculture in the global commodity landscape-from input costs to policy risks.

What's at Stake for U.S. Producers
The implications are clear: American growers are facing increased global competition, uncertain export demand, and an evolving trade environment that may further favor Brazil in the short term. As the 2025 harvest nears, U.S. producers must monitor both domestic pricing competitiveness and geopolitical developments closely.

The Farm Progress panel was the first in a weeklong series of conversations focused on commodity pricing, international markets, and the future of precision agriculture. Wednesday's follow-up session will feature industry leaders including Matt Bennett, Arlan Suderman, Vince Reincke, and Bruce Blythe, providing further analysis on how U.S. ag can adapt.