Officials and lawmakers from the Trump administration are contemplating a relief package for U.S. farmers in anticipation of retaliatory measures against U.S. tariffs. These considerations arise as countries such as China and Canada have already implemented duties on key agricultural exports from the United States. During Trump’s initial term, during a similar tariff situation, farmers received $23 billion in aid.
The Trump administration has initiated an examination of potential support for U.S. farmers as agricultural trade organizations caution about the economic consequences of ongoing tariff disputes. With President Donald Trump’s broad import taxes posing a threat to U.S. farm exports, Agriculture Secretary Brooke Rollins recently assured reporters that mechanisms were being set up to address short-term economic issues facing farmers and ranchers. Additionally, she emphasized to CNN the importance of preparing for potential “longer-term damage” by collaborating with lawmakers to secure necessary funding.
Senator John Hoeven from North Dakota confirmed the ongoing discussions pertaining to a possible farm bailout and his discussions with Secretary Rollins. However, the USDA has not yet provided a comment to Fortune on the matter.
Trump announced on Wednesday a minimum 10% levy on all imports, with certain trading partners facing even higher rates. Several nations have retaliated with levies targeting specific industries. By Friday, China had declared a 34% tariff on U.S. imports following a previous imposition of a 15% tariff on U.S.-grown agricultural products and a 10% tariff on various other farm products. Canada also responded by imposing 25% duties on U.S. goods, such as peanut butter and orange juice, valued at $30 billion, with threats to further expand its tariffs.
Trade organizations have expressed concern that these retaliatory measures could negatively impact the pricing of crops like corn, soybeans, and cotton. The price of soybeans recently dropped over 3% and has decreased nearly 17% since the previous year. Approximately 60% of the soybeans, meal, and soy oil produced in the United States are exported.
Barry Evans, a Texas sorghum and cotton farmer and board member of a sorghum trade group, commented to The Wall Street Journal on the anticipated need for a bailout to avoid significant disaster.
The American Farm Bureau Federation outlines that exports account for over 20% of annual income for the farming industry. The U.S. exported agricultural products worth $176 billion in 2024, with significant percentages going to Mexico, Canada, and China. Leading U.S. exports include soybeans, livestock products, and grains.
During Trump’s initial term, tariffs led to retaliations that resulted in a $27 billion decline in agricultural exports, with the government providing $23 billion in aid to farmers to counterbalance these losses. The recent retaliatory tariffs compound the challenges facing the already strained agricultural sector.
Last year, Congress authorized a $10 billion relief package aimed at alleviating the effects of increased input costs and declining commodity prices, with recent distributions of the aid underway. A larger package may be necessary given the broad challenges currently facing the industry, as advised by a congressional aide to WSJ.
Zippy Duvall, president of the Farm Bureau, expressed concerns in a comment to WSJ, acknowledging the administration’s efforts to level international trade but warning against the economic threat posed by heightened tariffs to farmers who have endured financial losses for several years.
In addition to the impact of tariffs on exports, the imposed U.S. tariffs on imports could escalate the costs of essential equipment and materials, adding to farmer burdens. Furthermore, farmers are affected by the dismantling of USAID by the Department of Government Efficiency, which previously involved a $2.1 billion government purchase of food aid from American farmers in 2020.
This article was originally published on Fortune.com.
