Republicans will control all three branches of government come the new year, and some ag trade leaders are reacting.
Former U.S. Ambassador Kip Tom says trade will look a whole lot different under a Trump Administration.
“We talk about trade—we went from nearly $37 billion surplus in the early days of Trump’s administration. Now, we’re projecting a $42 billion deficit in our food and ag trade,” according to Tom. “We also know that farmers’ incomes are off nearly 40 percent from 2022 to 2024. We know that regulations have grown by almost $1.67 trillion—and that’s highly inflationary because when those regulations or new taxes all come into place, that all gets handed back to the consumers or those of us in a space where we take the prices that were given for our products, so I think those are three key areas that we’ve got to get under control, and I think Trump is going to focus on those.”
Talks of trade also include concerns around tariffs. The President-Elect campaigned on promises of more tariffs since his last run in office. It is a situation Farm Bureau President Zippy Duvall is watching closely.
“Of course, we’re concerned about tariffs. Tariffs that could drive the cost of imported supplies like fertilizer. And it also, tariffs could limit the exports of goods that farmers and ranchers can export.”
Fertilizer analysts warn a 10 percent tariff on goods into the U.S. will do more than raise prices. Josh Linville with StoneX says suppliers could look elsewhere.
“The anticipation was the penalty would be paid by the nation that they were imposing it against. Against Morocco. Against Russia. And they would have to pay their five, ten, 15 percent duty to the government to bring tons in here. What that doesn’t look at is that because it is a commodity, that country has the ability to go elsewhere. And they had been very successful because of how tight global phosphate markets have been from an inventory perspective with going somewhere else.”
Aside from possible tariffs, Linville says he is watching the urea market. He says tight supplies right now could lead to higher prices during planting season.
