In a typical harvesting season, the farmers cooperative near Lance Peterson’s west central Minnesota farm runs 13 trains full of soybeans to the West Coast for delivery to Asian markets. Each train contains 440,000 bushels of beans.

So far this year the co-op has run none.

Retaliatory tariffs that China placed on U.S. soybeans after President Donald Trump slapped protective tariffs on billions of dollars worth of Chinese imports have cost U.S. soybean farmers their most reliable export market, driven down their incomes and could cost some their livelihood if the trade war between the world’s two largest economies continues, economists and bankers say.

Minnesota farmers exported $2.1 billion in soybeans in 2016, making them the state’s top export crop. But now many farmers cannot afford to sell because tariffs have driven the purchase price for soybeans so far below the break-even point of $9 a bushel.

“The current price is $7.20,” said Peterson. “That is tremendous red ink. People are not selling at that price. They are either storing on their farms or storing in grain elevators.”

If the U.S. cannot regain the Chinese market in short order, said Kent Thiesse, a vice president and farm loan specialist at MinnStar Bank in Lake Crystal, some farmers in Minnesota could be forced to sell off land, refinance loans, and in “worst case scenarios, not be able to continue farming.”

Thiesse said the potential farm crisis could rival troubles the agricultural sector faced during the grain embargo to Russia in the 1980s.

In September, soybean exports to China totaled just 67,000 tons, the U.S. Department of Agriculture reported, down 2.5 million tons from the same period a year ago. This tariff-driven collapse has left soybean sales to China for the 2018-19 growing season 85 percent below last year, the USDA said. Minnesota does not keep those specific numbers for state soybean sales, but Minnesota’s soybean exports closely mirror the national trend, said Su Ye, a state agriculture department specialist in Chinese trade.

Prices have slumped badly for several years among other agricultural commodities. “Soybeans is the crop that has held its own and kept a lot of [Minnesota] farms on the positive side” of cash flow,” Thiesse said. “We’ve built the soybean market on exports and China makes up such a big part of that.”

While the president tried to soften tariff pushback with $12 billion in emergency aid to soybean farmers, economists and bankers say trouble looms if the trade war with China extends another few months.

Peterson, a 53-year-old corn and soybean producer, planted his first seed in 1986, while he was still in college. He spent eight years on the National Soybean Association board. He is not optimistic about a quick end to the trade war.

Trump began imposing protective tariffs on Chinese products in June in order to pressure China into fairer trading practices. Trump cited Chinese theft of U.S. business secrets and attempts to block access by U.S. companies from doing business in China as reasons for the tariffs. But the tariffs themselves were widespread, as was the retaliation.

Since imposing the levy on U.S. soybeans, the Chinese have simultaneously reduced their use of soybeans while finding new sources of soybeans in other countries, Peterson said. Those adjustments could form new international supply chains that the U.S. will find difficult to break.

“A lot of farmers think this is still going to get sorted out quickly,” Peterson said. “I’m not one of them. [In the soybean industry,] this idea of short-term pain for long-term gain is nonsense.”

Bob Worth, a corn and soybean farmer in Lincoln County, supports Trump and hopes for a quick fix.

China’s retaliatory tariffs have created new markets for Minnesota soybeans in Europe and other places, Worth said.

The president renegotiated the North American Free Trade Agreement and started trade talks with the European Union and Japan, Worth added.

There have been “a whole lot of positives” in Trump’s approach to trade, Worth said. “Given time, he’ll get [the soybean issue] fixed. He has done a lot of great things for the U.S. He’s going to help us in the long run.”

At the Minnesota agriculture department, Ye thinks it is too soon to judge the overall impacts of tariffs, but said they will play a role in decreased farm income. Still, Ye noted, annual figures are more reliable than monthly figures in determining success or failure of trade policies. Moreover, she added, low soybean prices mean cheaper livestock feed.

But the livestock industry in Minnesota has also been hit with retaliatory tariffs that will restrict sales of certain pork parts to China, such as pig ears, hoofs and internal organs, that are hard to sell to the rest of the world.

“We’re losing the market for non-premium cuts of pork,” said Kristen Duncanson, who raises pigs while growing soybeans and corn on her Minnesota farm. Duncanson thinks soybean farmers and pork producers are victims of unintended consequences in a trade war the Trump administration started too quickly.

“In the last four to six weeks, I’ve heard more stories from farmers about hits to their bottom lines that were more than they thought,” Duncanson said.

At Iowa State University, agricultural economist and crop market specialist Chad Hart warned that the emergency aid provided by the government is not coming close to filling the hole created by retaliation to Trump’s protective tariffs. The aid to soybean farmers offers a subsidy of $1.65 per bushel. But tariffs have driven down the price of soybeans by $2.20 per bushel, according to the USDA.

Hart also doesn’t see China “capitulating on soybeans.”

The Chinese were “buying beans to fuel their hog industry,” he explained. “You can find hog feed from other sources. We have also seen them adjust their average soybean rations.

Minnesota farmers may consider planting more corn, said Kevin Paap, a soybean and corn farmer and president of the Minnesota Farm Bureau. But years before the tariffs hit, corn was slumping in price. Today, it still costs more per bushel to produce than it brings in revenue. It also costs more to plant than soybeans, Paap noted. The only way planting more corn makes sense, he explained, is if farmers are looking for domestic markets such as feed and biofuels to replace international markets.

Hart says things will become clearer soon.

“Watch what happens the next three months,” he said. “This is the time when the U.S. sees the vast bulk of soybean export sales. If the Chinese stay out, that puts a heck of a lot of pressure on Minnesota and other U.S. markets.”

The government is already projecting significantly less income for farmers. In August, USDA estimated a nationwide decline in inflation-adjusted net cash farm income of 13.8 percent for 2018 compared to 2017.

Bankers servicing the agricultural sector know this portends tough times for customers who already have exhausted their savings propping up weak prices. Renegotiating current loans or borrowing more in the winter of 2019 will be “more challenging” for farmers and bankers, MinnStar’s Thiesse conceded. Projected corn and soybean prices are both below break-even points and without peace in the trade war are very likely to stay there.

“If there is no aid payment next year,” Thiesse said, “you’re looking at negative cash flows.”

Peterson agreed.

“We may get through this in the near term,” he said. “But if things don’t change, no one can pencil in a profit for 2019.”