Soy Tariffs: Potentially Boosting Meat Prices in Germany? A Breakdown of the Scenario
Increase Likely in Meat Prices Due to Soy Supply
In a hypothetical yet increasingly plausible scenario, the heated trade feud between the EU and the US could potentially inflate Germany's meat prices. Experts are raising red flags, citing the EU's proposed tariffs on soybeans as a potential game-changer. After all, the US is by far the biggest supplier of soybeans to Germany.
This trade skirmish might strike an unwelcome chord among German consumers, pushing up meat prices. Hermann-Josef Baaken, CEO of the German Association of Animal Nutrition (DVT), voiced his concerns, "The escalating tariffs could indeed lead to meat price hikes."
The US's Soybean Supremacy
The US dominates the soybean supply chain to Germany. Of the 3.7 million tons imported in 2024[1], around two-thirds are from the US. A considerable portion of this volume is refined into soybean meal, an integral part of feed for livestock favorites such as pigs, poultry, and cattle, due to its high protein content[1]. Unfortunately, neither Germany nor the EU produce enough soybeans to meet the demand.
The Association of the German Meat Industry (VDF) anticipates a rise in soy procurement costs as a result of EU's punitive tariffs, further burdening livestock farmers and ultimately increasing animal product prices. Steffen Reiter, CEO of VDF, noted, "The exact degree of price increases remains to be seen." The magnitude of the tariffs yet remains undecided, and it's unclear whether and how other supplier nations can compensate for potential US shortfalls.
A Globe-trotting Soybean Supply
In response to the US tariffs on steel and aluminum imports, the EU announced retaliatory measures for American products starting from April. These measures include tariffs on whiskey, jeans, motorcycles, and peanut butter, along with agricultural products such as soybeans[1]. The EU may impose further tariffs on agri-imports in mid-April.
According to AMI market expert Nadja Pooh, the current global supply of soybeans is robust. Other significant players in the soybean market, including Brazil and Ukraine, have recently provided formidable competition for the US[3]. The German Farmers' Association considers it possible to turn to alternative sources of supply. Bernhard Krüsken, the General Secretary, still anticipates price impacts from the tariffs.
Pessimistic voices from the food industry concur, with Philipp Hennerkes, CEO of the Federal Association of the German Food Trade, expressing concern over the potential impact of tariffs on consumers in challenging economic times. The food conglomerate Premium Food Group, which includes the Tönnies slaughterhouses, deferred to the industry association VDF for comment.
Sources:[1] ntv.de[2] farmland.com[3] rhs.Ag(opens in a new tab)
- Meat Industry
- Soy
- Tariffs
- US
- EU
- The Association of the German Meat Industry (VDF) predicts increased soy procurement costs due to the EU's proposed tariffs on soybeans, which could further burden livestock farmers and ultimately increase animal product prices.
- Hermann-Josef Baaken, CEO of the German Association of Animal Nutrition (DVT), has voiced concerns that the escalating tariffs could lead to meat price hikes, given the US's dominance in the soybean supply chain to Germany.
- Philipp Hennerkes, CEO of the Federal Association of the German Food Trade, share concerns over the potential impact of tariffs on consumers during challenging economic times, as the US and EU engage in a trade feud that could potentially inflate Germany's meat prices.
