How Two Trade Wars Have Rewired Soybean Markets: Price Discovery, Risk Spillovers,and Liquidity Effects

Kelvin Bobbie

No 404348, 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association

Abstract: This study examines how trade-war shocks reshape soybean markets beyond their effects on prices. Focusing on the 2018–2019 Sino–U.S. trade war and the renewed trade disruptions of 2025, we evaluate whether restrictions on access to China, the world's largest soybean importer, altered price discovery, cross-commodity linkages, risk transmission, and market quality in soybean futures markets. We combine daily futures data from the Chicago Board of Trade (CBOT) and China's Dalian Commodity Exchange (DCE) to compare market responses across the two episodes. Using event-study methods, connectedness measures derived from vector autoregressions, and a copulabased CoVaR framework, we analyze how trade-war shocks affect information leadership in U.S. soybean markets, spillovers across the agricultural complex, and tail-risk transmission between U.S. and Chinese soybean markets. We hypothesize that trade-war disruptions weaken the price discovery role of CBOT soybean futures, intensify risk spillovers, and reduce market quality through higher volatility and lower liquidity. Findings will contribute to understanding how geopolitical trade disruptions affect commodity market resilience, information transmission, and the reliability of benchmark agricultural futures markets.

Keywords: Agricultural Finance; Farm Management (search for similar items in EconPapers)
Pages: 15
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/404348/files/1 ... _Soybean_Markets.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea26:404348

DOI: 10.22004/ag.econ.404348

Access Statistics for this paper

More papers in 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().