The convergence of an underutilized transit channel and new deforestation regulations could present a tremendous opportunity for U.S. soybean exports to the European Union (EU). To meet the moment, Illinois Soybean Association (ISA) is proactively organizing international meetings, researching trade expansion paths and assessing the competitive advantages of Illinois soy.

Diversifying exports beyond the Illinois and Mississippi rivers to include the St. Lawrence Seaway north of Illinois offers significant potential benefits. This opportunity, combined with the new EU Deforestation Regulation (EUDR)—now proposed for full implementation by December 30, 2025—could strengthen Illinois farmers’ strategic advantage over producers in regions like Brazil.

EU Value Proposition
The EU is an increasingly important buyer of U.S. soybeans, according to data from the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS). The value of soy shipped to this group of 27 European countries totaled $3.45 billion (6.12 million metric tons) in 2023, the most recent year for which data are available. That’s second only to China, to whom $15.06 billion of soy was exported. And over the past decade, soy exports to the EU have risen 97 percent, FAS notes.

Factors Driving EU Focus

Although the Illinois and Mississippi rivers help ferry the bulk of Illinois soybeans to the EU via the Gulf of Mexico, there are several reasons to explore additional export channels. The Mississippi has experienced record low water levels multiple years in a row. This can hamper efforts to transport soybeans in a timely way. And despite planned lock-and-dam infrastructure investments that would enable barges to move more freight, those upgrades— as reported in recent issues of IL Field & Bean—will take years to complete.

Buyers in Europe and beyond increasingly want to purchase identity-preserved soy products and soy with a lower carbon footprint compared to other options. Expansion of containerized shipping in the underutilized St. Lawrence Seaway—which connects the Great Lakes to the Atlantic Ocean—could address these sustainability needs by reducing emissions with a more straightforward transportation route. It could also improve traceability so buyers can pinpoint exactly where commodities originated.

Some of Europe’s largest ports could benefit from a preferential trade route via the seaway. Rotterdam in the Netherlands is the largest port in Europe and No. 13 worldwide by volume. Meanwhile, Antwerp in Belgium is the second largest port in Europe. By partnering on trade routes with such ports, ships delivering Illinois soybeans could then backhaul soy and other ag products from Europe into the Upper Midwest on the return trip. Heightened use of the St. Lawrence Seaway could open channels to growing areas of soy demand beyond Europe— including the Mediterranean, the Middle East and North Africa.

Increased usage of the St. Lawrence Seaway could open channels to growing areas of soy demand beyond Europe—including in the Mediterranean, the Middle East and North Africa.

Illinois Is Ready For EUDR
Another beneficial reason to pursue deeper EU ties is the new EUDR rule, which will prohibit European importers from accepting key commodities such as soy grown on land deforested after Dec. 31, 2020. Negotiations and fine-tuning of the rule are expected to continue through much of 2025.

This could create a window of opportunity for Illinois soybean growers compared to those in countries such as Brazil, where deforestation for production of soy, cattle and other commodities is more prevalent. Data from the EU Forest Observatory identifies global land that has been converted from forest into agricultural production. Its records indicate deforestation that has occurred since Dec. 31, 2020, totaling:

• 5.3 million hectares in Brazil
• 483,690 hectares in Paraguay
• 329,925 hectares in Argentina
• 34,966 hectares in the U.S.
• 17,553 hectares in Spain
• 13,625 hectares in France

It’s important to point out that those U.S. figures don’t include a single acre of Illinois farmland. And most of the included acres aren’t near soybean production regions, according to the U.S. Soybean Export Council (USSEC).

European buyers who fail to perform the required due diligence with supporting data illustrating their compliance face fines and other penalties, according to a July 2024 analysis published by researchers at the University of Illinois’ farmdocdaily website. Illinois, which exports 60 percent of its total soybean crop annually, is well positioned to maintain market access. That’s because of the state’s ability to ship soybeans in containers and because of continued investments in sustainable production practices.

With this kind of attention to detail, including high-quality soybeans used in global meal production, soy exports to Europe are expected to keep growing.

More broadly, the EUDR will yield beneficial environmental outcomes for communities worldwide.

“We can all agree that this will decrease deforestation and lead to a path to better sustainability practices globally,” says Rosalind Leeck, Executive Director – Market Access and Strategy, USSEC.

European trading partners met with representatives of the Illinois Soybean Association and the Specialty Soya and Grains Alliance during meetings in September 2024. The collaboration aims to expand shipping through the St. Lawrence Seaway, reducing the carbon footprint of Illinois soy and helping European buyers meet their decarbonization and sustainable sourcing goals. Photo Credit: Tim Rendall, Illinois Soybean Association

ISA Eyes St. Lawrence Seaway
That market expansion won’t happen on its own, though. Illinois farmers’ investment in ISA is supporting this renewed exploration of EU trade relationships. The ISA team has been busy working multiple angles over the past year, emphasizing the potential of the St. Lawrence Seaway.

The shipping channel is an engineering marvel. Ships en route to their destination are raised a total of 602 feet between the Atlantic Ocean and Lake Superior—the equivalent of transporting a ship up a 60-story building using the gravity of its lock-and-dam system.

The seaway is operational 285 days each year and boasts more than 99 percent system reliability. Because of winter weather that freezes the Great Lakes, its season runs from approximately mid to late March to at least the end of December each year. The seaway helps power the Great Lakes Regional Economy, which, if it were a country, would rank third globally behind only the U.S. and China.

In fiscal year 2025, ISA has funded the St. Lawrence Seaway Trade Revitalization Project. The initiative will take place in partnership with the Specialty Soya and Grains Alliance. It will evaluate ways to recharge the Great Lakes-EU trade route.

For example, in September, the two organizations participated in a trade mission to the previously mentioned ports of Antwerp and Rotterdam. Representatives connected with shipping companies, logistics providers and grain buyers to educate them on the advantages of the seaway as a viable and preferential trade route.

Illinois soybean farmers seeking new markets also will benefit from several recent infrastructure investments. Among those upgrades is hands-free mooring technology. Fully deployed across the seaway in 2019, the shipping corridor uses vacuum pads to help ships make the journey, improving safety and efficiency, according to an article in Professional Mariner.

Major agriculture companies are building up capacity. In 2023, The DeLong Co.’s Agricultural Bulk Export Facility opened in Milwaukee. Corporate, state and federal funding has enabled additional expansion to handle more grain volume and storage, according to a news release from the company.

Looking ahead, development of an international terminal for sea cargo containers is planned at Ports of Indiana-Burns Harbor. The first-of-its-kind facility on Lake Michigan is scheduled to be constructed in 2025, and shipments are anticipated to begin in 2026, according to an article in The Maritime Executive.

Illinois Soybean Association Board Member Jeff O’Connor speaks during a stop on a September 2024 trade mission to Europe. He partnered with the Specialty Soya and Grains Alliance on the trip. Photo Credit: Tim Rendall, Illinois Soybean Association

Sailing Toward Opportunity
Resilience will be a top priority for Illinois soybean farmers in 2025 and beyond. Investing in expanded market access to places such as the EU, via emerging transit routes such as the St. Lawrence Seaway, will help diversify the industry’s approach to meeting customers’ needs.

Developing this shipping corridor will result in a preferential trade route between EU markets and Midwest farms while mitigating the environmental impact of moving soybeans from Illinois fields to European consumers.