U.S. soybean growers are targeting new markets as demand from China has plunged dramatically due to the escalating Washington-Beijing trade war.

The world's two largest economies are locked in a prolonged tariff battle that has dragged on for more than a year. Both countries have slapped additional levies on billions of dollars worth of each other's goods, and the escalating tensions have spooked markets and hurt the outlook for global economic growth.

That has sent American soybean exports to China falling sharply, with total shipments to the Asian economic giant expected to end this marketing year some two-thirds lower, said Jim Sutter, chief executive officer of the U.S. Soybean Export Council.

"This year our exports to China look like they'll be a third of what they had been in the last few years, so instead of being 30 million tons like they were last year, it looks like they'll be around 10 (millions tons) this year...That's a huge difference," Sutter told CNBC at the S.E. Asia U.S Agriculture Co‐operators Conference in Singapore.

China is the world's largest consumer of soybeans and accounted for 60% of U.S. soybean exports before the trade dispute pulled shipment levels down. China made up $5.9 billion in U.S. farm product exports in 2018, according to the U.S. Census.

A further blow came when China confirmed early Tuesday that the country was pulling out of U.S. agriculture as a weapon in the ongoing trade war.

A spokesperson for the Chinese Ministry of Commerce said Chinese companies have stopped purchasing U.S. agricultural products in response to U.S. President Donald Trump's recently announced additional 10% tariffs on $300 billion of Chinese goods.

To manage the collapse of Chinese buying, American soybean farmers have been working alternative markets, said Sutter. Fast-growing markets that have absorbed half of the remaining stocks include Europe, emerging regions in Southeast Asia, Egypt, Bangladesh and Pakistan.

While the U.S. soybean trade has been working to sell what would have otherwise gone to China, "unfortunately it doesn't look like we'll quite get there this year," said Sutter.

So American farmers are expected to be left with a record high level of ending stocks of over 1 billion bushels in this marketing year that ends on Aug. 31, as estimated by the U.S. Department of Agriculture. That will be more than double the 438 million bushes in the previous marketing year.

To develop new markets, Sutter said, the U.S. Soybean Export Council will be intensifying its marketing efforts globally.

Europe is a market in which U.S. soybean exports have fared well, with the market share of the American oilseeds expected to hit 75% of imports this year — up from 30% previously, said Sutter.