China’s retaliatory tariffs on U.S. goods went into effect this week, slapping new duties on more than $22 billion of agricultural exports. But many in the agricultural community see merit in President Donald Trump’s trade agenda and are willing to accept the short-term sting.
The Trump administration has increased duties on China twice since entering office less than two months ago, prompting retaliatory duties against U.S. beef, pork, sorghum, nuts, produce, pulses, dairy, poultry, wheat, corn and cotton that went into effect this week.
The president has also ignited a trade spat with Canada and Mexico that has led to new tariffs on around half of imports from Mexico and an even greater share of Canadian exports, according to one administration official’s reckoning. On Wednesday, the administration ended several countries’ exemptions from steel tariffs and hiked the duty applied to foreign aluminum.
Jackie Mundt has a crop and cattle farm in Pratt County, Kansas, and is the director of communications for the Kanza Cooperative Association. She told Agri-Pulse that there is still “very strong sentiment and support” for Trump’s trade agenda, even as tariffs and retaliation against U.S. agriculture begins to take shape.
“There are definitely people who don't support what he's doing, but I would say they're in the minority,” Mundt said.
Row crop farmers send large volumes of products to China and other U.S. trade partners at the center of Trump’s trade disputes, Mundt said. But even so, they are likely to give the administration a very long runway when it comes to trade policy. Growers are used to waiting for reimbursements for poor yields until after the crop season. Their cash flow is set up to withstand economic turbulence and should be able to weather adverse effects from tariffs until then.
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“A grain farmer may not have to pay for his inputs – depending on what kind of financing he has – until next January,” Mundt said.
Trump carried rural districts by a wide margin in November’s election. Accordingly, Mundt argued that tariffs would “have to hit the pocketbooks in a way that is significant, I think, before folks in this part of the world are going to give up on Trump."
Trump has indicated that next month could see even broader tariffs applied to U.S. trade partners. The president has directed officials to look into the application of reciprocal tariffs on countries that maintain higher duties than the United States. Commerce Secretary Howard Lutnick has suggested that these could be ready to implement from April 2.
That date, Trump said last week, will be “the big one” for tariffs. “There’ll be no getting out of it.”
The messaging around these reciprocal tariffs, Mundt added, has particularly resonated with farmers, who see the move as part of a broader effort to stand up for farms and small businesses in international trade.
At the National Farmers Union annual meeting in Oklahoma City this week, George Davis of the California Farmers Union compared tariffs to fires. "Use a well-targeted and well-timed tariff for a specific purpose and it can get rid of the underbrush. A wholesale tariff directed at a large sector blindly can wreak a lot of havoc like a wildfire and that's what we're facing right now," he said.
Jon Hansen of the Nebraska Farmers Union said tariffs “can be used in a variety of ways to deal with a number of inequities.”
Meanwhile, Michigan farmer Matt Sattelberg, co-owner of Bay Shore, an agricultural equipment distributor, told Agri-Pulse recently he expects Trump’s trade policy to hurt his bottom line. The president has indicated that tariffs on the European Union are forthcoming and has railed against the EU charging higher tariff rates than the U.S.
Bay Shore is the only U.S. distributor of Austria's Hatzenbichler tillage, planter and harrowing equipment.
“Definitely not going to be great for our company,” Sattelberg said. But he added that he was broadly supportive of the president’s efforts to use tariffs to introduce more reciprocity in U.S. trade relationships and fund tax cuts.
“There is some correction that needs to be done with our trade deals,” Sattelberg said.
“We feel that the tariffs are absolutely necessary,” Bill Bullard, CEO of R-CALF USA and a one-time rancher in South Dakota, told Agri-Pulse. R-CALF has long fought imports of Canadian cattle.
Beijing hit U.S. beef with new 10% duties Monday and Canada’s Finance Department has indicated beef products will feature in future retaliation if the U.S. expands tariffs on Canadian products next month, as Trump has suggested. But Bullard sees both countries’ retaliation as a “knee-jerk initial reaction” and suggested it is just a temporary part of the process of resetting U.S. trade relations.
We’re “not concerned about the retaliation,” Bullard said. “The countries are just posturing, but soon we'll reach a state of normalization.”
Should countries retaliate against reciprocal tariffs – and the EU has already vowed that it will – some U.S. agriculture sectors will be hit harder than others. Grains, oilseeds and fruit and tree nuts are highly export-reliant, for example, and more exposed to trade volatility.
But that doesn’t mean representatives of these sectors don’t see opportunities and merits in Trump’s tariff approach. Jim Sutter, CEO at the U.S. Soybean Export Council, told Agri-Pulse last week that he anticipates that countries will cut deals to avoid new duties and U.S. agriculture could be well-placed to benefit.
“I view this as an opportunity for us to almost be negotiating kind of mini trade agreements with many different countries,” Sutter said.
U.S. soybean producers export almost $30 billion annually, with more than half of that going to a single destination: China. The industry also faces intense competition from lower-cost South American producers that have been rapidly expanding acreage.
Reciprocal tariffs, Sutter argued, could be wielded to increase U.S. market share in some of the more difficult-to-break economies.
“We've been viewing these reciprocal tariffs,” he said, as a way “to improve the competitiveness of U.S. agriculture into a lot of various markets.”
Tariffs put irreplaceable markets in play
Not everyone is persuaded, however, that the short-term pain will unlock long-term gains. U.S. soybean exports to China, after all, never fully recaptured their market share after Beijing retaliated to Trump’s first-term tariffs, according to research from the University of Illinois.
Soybeans offer a “cautionary tale,” Rebeckah Adcock, vice president of U.S. government relations at the International Fresh Produce Association told Agri-Pulse, as other industries eye Beijing’s latest retaliatory tariffs with trepidation.
“When we change how we do business with them, or put tariffs in place, they tend to take a while to get those markets back, if they ever come back,” Adcock said. She added that she wouldn’t want the Chinese market for apples or tree nuts to shrink; both have been hit with new 10% duties.
U.S. pork producers sent around $1.2 billion of product to China last year, with offal making up around half of those exports, according to Maria Zieba, vice president of government affairs at the National Pork Producers Council.
“In other words, the ears, snouts, stomachs, other organs,” Joe Schuele, vice president of communications at the U.S. Meat Export Federation, told Agri-Pulse.
Bill Bullard (Photo by R-CALF USA)If the U.S. loses market share for these products in China, it won't be easy to find another market, he said.
Not every country has consumer spending habits that values offal. Schuele said there has been an effort in recent years to boost exports to places like the Philippines, Vietnam, Mexico and other parts of Latin America and the Caribbean. But there is no market for offal that can replace China’s volume.
Herein also lies a potential pitfall with Trump’s appeal to U.S. farmers to prepare to increase domestic sales, Zieba said. U.S. pork producers primarily export lower-value items that aren't consumed in the United States.
“We're not raising animals for the export market. We're raising animals for U.S. consumption and then have items that aren't as consumed in the United States that we that we then export out,” Zieba said.
“You're really not going to see a groundswell of domestic demand for pork offal items,” Schuele added.
Bullard, however, argued that U.S. beef, like U.S. lamb, has underproduced for the U.S. market, and would have ample room to grow if tariffs curbed foreign beef imports. But Schuele pointed out that exported beef often commands a better price than products sold domestically, and while there may be opportunities to grow in the domestic market, it might not lead to higher profits if U.S. exports lose access to international markets.
About 15% of U.S. beef is exported, Schuele said. “But that 15% represents a very important component of producer profitability … you're exporting those items because they can command a better price.”
“If you eliminate that premium,” Schuele added, “then that's less revenue in the pocket of the producers.”
A turning point?
Several economic markers have begun flashing red in recent weeks. The Federal Reserve Bank of Atlanta’s growth projection model now projects a 2.5% GDP contraction in the first quarter of 2025 – which would be the worst growth rate since the height of the pandemic. Consumer sentiment fell for the second straight month in February and layoffs surged more than 200%, according to the Challenger report published by Challenger, Gray and Christmas, a global outplacement firm.
Tariffs are partly to blame. Goldman Sachs shaved 0.7 percentage points off its 2025 U.S. GDP forecast Monday, citing increased tariff uncertainty.
Even if the U.S. enters a period of recession, Bullard remains optimistic about prospects for U.S. agriculture. Demand for eggs, after all, remains robust despite recent price increases, he said.
“We've seen incredibly strong beef demand and at prices that we've never expected consumers will to be willing to pay,” Bullard said. “We may see some adjustments in the market, particularly if we do go through a recessionary period, but we're confident that if we stay the course – and that is to begin a systematic process of putting tariffs in place that allow our producers to compete on a level playing field – we think our industry is going to prosper.”
Adcock, however, said that patience is already running thin in the produce industry. Those who give Trump plenty of runway to use tariffs as a negotiating tool are “a shrinking crowd,” she said.
“We're already beginning to see, especially with the Canadian market, a big contraction, with or without tariffs,” Adcock said. “They have given him some rope, but they really would now like for him to put a bow on that and find paths forward to continue trade across the North American continent.”
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