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This research investigates how US–China trade policy announcements affect corn and soybean markets and hedging costs.

The Cost of Uncertainty: US–China Tariff Effects on Agricultural Commodity Markets

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This research investigates how US–China trade policy announcements affect corn and soybean markets and hedging costs.
Analyzed time-series models of corn and soybean market responses to tariff announcements.
Evaluated implied volatility during the 2018–2019 trade war across multiple strike prices.
Prospective tariff announcements significantly increased implied volatility, especially at the 90% and 95% strikes.
A 7.5% rise in implied volatility led to a 3.75% increase in soybean option premiums.
Findings highlight the increased financial burden on producers due to uncertainty beyond just changes in commodity prices.

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Randomized trial examines tariff effects on corn and soybean markets, suggesting financial burdens from uncertainty.

Raghav Goyal (2026) studied this question.

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