US Farmers Gird for Trade Wars on Trump Tariff Pledges

Nov 11, 2024

By Beiyi Seow

Donald Trump's first White House term saw a bruising trade war with China that left a lingering impact on farmers -- and many are bracing for further fallout as the President-elect threatens higher levies on Beijing.

Trump tariffs since 2018 hit some $300 billion of Chinese imports, sparking retaliation that targeted key farm products like soybeans and caused such exports to fall.

US farmers relied on subsidies to get by at the time and say China has since reduced its reliance on American agriculture products.

Trump has suggested tariffs on all imports this time -- with an especially high rate on China -- making many farm owners jittery of a return to trade tensions.

But this comes even as Trump's Republican party saw wide support in rural areas during this year's election, with many farmers supporting him despite the financial hit in the trade war. The hope is for economic conditions to improve.

'No money'

"There was no money to pay the bills, no money to actually have a living out of the operation," said Ted Winter, whose farm in Minnesota grows corn and soybeans.

Retaliatory tariffs on the United States caused more than $27 billion in US agricultural export losses from mid-2018 to late-2019, the Department of Agriculture (USDA) found.

China accounted for around 95 percent of value lost.

Soybeans in particular made up nearly 71 percent of total trade loss, with Brazil gaining most of the lost trade.

Michael Slattery, who grows crops like corn, soybeans and wheat in Wisconsin, added: "I view this second term with tremendous trepidation."

Between 2017 and 2018 for example, his soybean income fell by over $25,000 -- and government payouts to alleviate the pain made up for just over half the shortfall.

The USDA estimates agriculture and related industries contributed a 5.6 percent share to GDP in 2023, while direct on-farm employment made up 2.6 million jobs as of recent years.

Lasting hit

"What is more frightening is the breakdown in commercial order that has taken decades to establish," Slattery said.

While US farm exports to China rebounded after Washington and Beijing reached a trade war truce in 2020, a year after the deal, American market share remained lower than levels seen before the retaliatory tariffs were enacted.

"The tariffs that were imposed upon China drove them to find other sources for their food needs," said Winter.

And without foreign buyers like China to absorb excess farm production, the market becomes oversaturated, in turn driving down prices and farmer incomes, said Slattery.

Federal payments may have been helpful to farmers during the trade war, but trade ramifications extended long beyond it, said Scott Gerlt, chief economist at the American Soybean Association (ASA).

'Prime targets'

Soybeans and corn will again be "prime targets for tariffs" in a potential trade dispute, according to a National Corn Growers Association and ASA report last month.

Both commodities account for about one-fourth of the country's agriculture export value.

The report cautioned that many tariffs China imposed on US farm products have been given a waiver but could be reinstated -- triggering an average drop of 51.8 percent in US soybean exports from expected levels.

Similarly, corn exports to China would also slide.

Brazil and Argentina, meanwhile, are expected to gain global market share with higher exports.

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Video: The 15-Year Bet Behind Every New Variety!

Canada is trying to decide how much agricultural research capacity it can afford to lose. Brian Rossnagel believes the better question is whether the country can afford to rebuild it.

The longtime barley and oat breeder makes the case with a simple fact about his profession: the consequences of today’s decisions may not become visible for 10 or 15 years.

“Pick the right parents. That’s the biggest thing,” Rossnagel says. “If you pick the wrong parents, you’re not going to get anywhere—and you don’t know that until 10 years, 15 years later.”

That warning carries particular weight as Agriculture and Agri-Food Canada moves to reduce spending and streamline parts of its science operations. The department’s 2026–27 plan anticipates the loss of approximately 665 positions by 2028–29 and says some research will be reduced where capacity exists in academia or industry. AAFC says the changes will make its science operations more cost-effective over the long term.

For Canada’s seed industry, Rossnagel’s career illustrates what is at stake.

This fall, the retired University of Saskatchewan breeder will be inducted into the Canadian Agricultural Hall of Fame. During his 35-year career at the Crop Development Centre, he helped develop more than 100 barley and oat varieties, including CDC Austenson—one of Western Canada’s most widely grown feed barleys. His induction recognizes not only those varieties, but the collaboration and research system that made them possible.

Rossnagel is quick to emphasize that none of it was the work of one person.

“The first thing I thought about was all the other people who contributed to whatever success I and my program had over the years,” he says. “We know that it’s not an individual who does this. It’s a group—a team.”

That team extends well beyond the breeder whose name appears beside a variety. It includes technicians, pathologists, quality specialists, statisticians, regional testing sites, seed growers and industry partners. It also includes the breeders who came before and those who will carry the germplasm forward.

CDC Fraser barley, for example, moved through three breeding careers. Its parents came from Brian Harvey’s program. Rossnagel advanced the material after Harvey retired, and Aaron Beattie later guided it through registration and release.

That kind of handoff is normal in plant breeding. The person who makes the original cross may never see the resulting variety reach farmers.

It also explains why lost research capacity cannot simply be switched back on when budgets improve.

“If you shut it off, it’s very, very difficult—and particularly costly—to start it up again,” Rossnagel says. “If you have to start from scratch, it’s going to be at least 10 years before anybody notices whether you’re getting anything done or not.”

The concern is not simply how many experimental lines Canada can process. Modern equipment, statistical tools and genetic technologies allow today’s breeding programs to evaluate tens of thousands of lines—far more than Rossnagel could handle when he entered the field in the early 1970s.

But efficiency and automation do not generate every idea.

“If you pare back down, and instead of having six or seven individual scientists concentrating on wheat breeding, you go down and say three people could handle all this, well, that’s half the ideas gone,” he says. “Particularly if you happen to lose the three people who had the really neat and innovative ideas, boy, that’s a problem.”

It is a timely distinction for Canadian agriculture. Consolidating programs may preserve the volume of material moving through a system, at least initially. It may not preserve the diversity of thinking, regional knowledge or willingness to pursue unconventional crosses.

That regional knowledge matters because Canadian agriculture is not one uniform production environment. A variety suited to southern Alberta may face different disease, moisture and maturity pressures than one grown in Manitoba, Ontario or Atlantic Canada.

“Agriculture is applied biology,” Rossnagel says. “Biology, all around the Earth, moves from the poles to the equator. It does not move from Newfoundland to B.C. like politics do.”