Throttled by U.S. President Donald Trump’s sweeping trade war, U.S. farmers are finally seeing some temporary—and long-promised—relief in the form of a $12 billion bailout.
The Trump administration on Monday unveiled the hefty aid package, which is aimed at making amends with a key voter base that has become collateral damage in Trump’s trade war with China and other top economic partners.
Throttled by U.S. President Donald Trump’s sweeping trade war, U.S. farmers are finally seeing some temporary—and long-promised—relief in the form of a $12 billion bailout.
The Trump administration on Monday unveiled the hefty aid package, which is aimed at making amends with a key voter base that has become collateral damage in Trump’s trade war with China and other top economic partners.
But American farmers are far from out of the woods.
Small-farm bankruptcies soared to a five-year high this year as the sector has grappled with trade tensions, high input costs, lower crop priceslabor uncertainties, and slashed federal grants and funding.
Trump, for his part, struck a cheerful tone in his announcement and touted his popularity among the U.S. agricultural sector. “We love our farmers,” Trump declared. “And as you know, the farmers like me,” he said, citing voting trends.
Trump may say he loves American farmers, but the bigger question is whether China does, too. Last year, China was the top market for U.S. farmers, with soybeans being their single biggest export to the country in value. After Trump launched his trade war against much of the world, Beijing retaliated by snubbing American soybeans, instantly roiling the U.S. agricultural sector and turning up the heat on Washington.
Many farmers breathed a slight sigh of relief in October, when the Trump administration announced that China had committed to buying 12 million metric tons of soybeans this year, as well as at least 25 million metric tons of soybeans annually over the next three years. But with less than a month to go before the end of the year, China has only purchased around 20 percent of what it agreed to, the Wall Street Journal reported.
“The real concern for me still is trade with China and the fact that that’s a long way from being normalized,” said Joseph Glauber, a former chief economist at the U.S. Department of Agriculture who is now at the International Food Policy Research Institute.
If this sounds like a familiar story, that’s because it is. The U.S. agricultural sector also sustained heavy losses under Trump’s first-term trade war, ultimately prompting the U.S. leader to dole out at least $23 billion to help cushion the blow—nearly double the current promised bailout.
Chris Barrett, an agricultural economist at Cornell University, told Foreign Policy in an email that $12 billion is “far less than the losses” generated from Trump’s trade spats. “No one yet has a clear sense of total US farm losses due to the bigger trade wars now being waged, but they almost surely exceed $40 billion this year,” Barrett said.
“The great irony, of course, is that farmers voted overwhelmingly for a candidate who promised higher tariffs just as he had done before, provoking exactly this same response from China and other trade partners,” Barrett added.
In fact, U.S. soybean farmers are still grappling with the long-term consequences of Trump’s first trade war—namely the loss of considerable market share to Brazil. Today, as Chinese soybean trade with American farmers has again faltered, Brazilian farmers have helped fill the void.
That all spells trouble for American soybean farmers. “Farmers want export market access, not hand outs,” said Barrett.
Caleb Ragland, the president of the American Soybean Association, said in a statement released on Monday that the association “appreciate[d]” the Trump administration’s attention and sees the bailout as “a positive first step to restore certainty.”
Some Democratic lawmakers slammed the Trump administration’s bailout by pointing to the economic costs of Trump’s tariffs.
“Instead of proposing government handouts, Donald Trump should end his destructive tariff spree so American farmers can compete and win on a level playing field,” Sen. Ron Wyden said in a statement on Monday.
“Trump’s plan to bail out farmers won’t even get agriculture communities back to even,” he added. “They’re still paying more for fertilizer, equipment and seeds, while grown-in-the-USA farm goods are facing more obstacles than ever in foreign markets.”
Yet Trump appears firmly committed to his tariff regime. After announcing the bailout, Trump again threatened “severe tariffs” on Canadian fertilizer, which U.S. farmers rely on in trade. Such tariffs would risk further straining their finances.
Tariffs have “greatly enhanced” U.S. national security and made the United States “the financially strongest Country, by far, anywhere in the World,” Trump declared in a post on Truth Social on Tuesday. “Only dark and sinister forces would want to see that end!!!” he added.
