By Ryan Hanrahan
Bloomberg’s Gerson Freitas Jr and Ilena Peng reported that “the US agricultural trade deficit hit a record high in the first half of 2025, underscoring the continued decline of American farmers’ long-dominant role in global exports amid President Donald Trump’s trade wars. The value of agricultural exports trailed that of imports by $4.1 billion in June a gap 14% wider than a year earlier pushing the sector’s deficit to a staggering $28.6 billion for the first six months of the year, according to data released Thursday by the US Department of Agriculture.”
“The widening deficit marks a historic reversal for the US agricultural sector, which for the past five decades had consistently run major trade surpluses even serving as a key foreign policy tool during the Cold War,” Freitas Jr and Peng reported. “The shift in fortunes began during President Donald Trump’s trade war with China in his first term, with the initial annual deficits recorded in 2019 and 2020. More followed, with negative flows seen over the past three years.”
“Limited capacity to further expand crop and livestock production and Americans’ growing appetite for imported produce have helped erode the balance. In addition, Trump’s trade wars have played a role, pushing China the world’s largest crop importer to rely more heavily on Brazil for its supplies,” Freitas Jr and Peng reported. “Some companies including Brazilian beef producer Minerva SA have increased shipments to the US ahead of Trump’s new tariffs. The US is also processing more of its crops domestically to produce biofuel, reducing exportable surpluses.”
While the ag trade deficit has widened, Reuters’ Dan Burns reported that the overall U.S. trade deficit “narrowed 16.0% in June to $60.2 billion, the Commerce Department’s Bureau of Economic Analysis said on Tuesday. Days after reporting that the goods trade deficit tumbled 10.8% to its lowest since September 2023, the government said the full deficit including services also was its narrowest since then.”
Source : illinois.edu