
| Thought this was interesting. U.S. Embargo led Japan to invest billions in the Cerrado. "Misguided trade decisions during times of political turmoil, along with major policy shifts, are nothing new in American history and the 1973 U.S. soybean embargo was raised in an earlier article (farmdoc daily, May 30, 2019). In short, an El Nino event off the coast of Peru harmed the anchovy harvest in the winter of 1972-1973, at a time when anchovies were an important source of protein for animal feed. One result was a run on soybeans to replace the protein, contributing to a soybean price spike at a time when the Nixon Administration was also trying to control inflation and fend off Congressional investigations (Coppess 2018; Akihiko 2017; Madigan 1994)." Then, President Nixon implemented an embargo on soybean (and cottonseed) exports in June 1973. The embargo was short-lived but had far-reaching impacts; the Administration ended the embargo and reinstated contracts by October 1, 1973, when it became clear that the soybean crop was larger than expected. In response, the European Community—a major customer of U.S. soybean exports—began dishing out large subsidies to increase production of oilseed crops in Europe (Madigan 1994). Japan also responded and may have had the most far-reaching impacts. Link. |