UPDATE (March 7, 2025): Since this put up was printed, the Trump administration diminished its tariff on Canadian potash from 25 % to 10 %, together with different merchandise from Canada and Mexico. However so long as the president continues to follow brinkmanship with US commerce coverage, the potential hurt to farmers and shoppers will stay.
On March 4, President Trump imposed tariffs of 25 % on all items imported from Canada and Mexico, and raised the prevailing tariff on China from 10 to twenty %. All three international locations have responded by implementing tariffs on US items. Moreover, on April 2, Trump is predicted to develop the tariff panorama to a number of international locations past Canada, China, and Mexico.
Tariffs are a tax imposed on items imported from different international locations. The newly imposed tariffs imply that companies importing items from Canada, China, and Mexico will now pay a tax of 25 % of the worth to the US authorities. Companies sometimes go that price on to shoppers, in the end making these merchandise costlier for all of us. My colleague Dr. Valuable Tshabalala just lately wrote a compelling weblog put up explaining how tariffs work, and the way President Trump’s tariffs will have an effect on inflation and meals costs in the USA. Tariffs are often carried out to advertise home manufacturing and consumption by making imported items prohibitively costly, however with regards to imported vegetables and fruit, there aren’t any home alternate options to sure merchandise that can not be cultivated right here due to unfavorable climate, soil, and rising situations. So if we would like avocados, for instance, we can have no alternative however to pay extra.
For fiscal 12 months (FY) 2025, present projections by the US Division of Agriculture (USDA) present that the USA is on a path to changing into an total importer of agricultural items. US agricultural exports—largely corn, soy, and meat merchandise—are projected at $170.5 billion, whereas imports are forecast at $219.5 billion. Which means that the USA is reliant on different nations for its meals provide, and jeopardizing worldwide commerce relations can have implications for meals safety.
The dimensions of this present commerce and tariff battle is broad, starting from vitality (like fossil gasoline) to automobile components, however we might be focusing particularly on imports associated to meals and agriculture.
What agricultural items will we import from, and export to, Canada, China, and Mexico?
Mexico is our largest buying and selling associate, with agricultural items imported by the USA totaling about $45 billion in 2023. In the identical 12 months, Mexico alone equipped about 63 % of our greens and 47 % of our fruits and nuts. And Mexico can be our greatest buyer with regards to agricultural exports, shopping for billions of {dollars} of corn, dairy, meat, and poultry.
Canada ranks second with regards to US agricultural exports, shopping for billions of {dollars} of baked items and contemporary vegetables and fruit. Based on USDA information, a majority of agricultural merchandise we import from Canada consists of meat, grains, and oilseeds, in addition to a key enter utilized in US agriculture: fertilizer. This important enter for the US farming system may very well be hit the toughest on this commerce battle.
China ranks third in agricultural exports from the USA after Mexico and Canada, spending billions of {dollars} yearly on US cotton, meat and meat merchandise, and soybeans. Whereas the vast majority of Chinese language items imported into the USA include manufactured items like electronics, equipment, and plastics, the United States additionally imports processed and contemporary vegetables and fruit, snacks, spices, and tea from China.
How tariffs might have an effect on fertilizer manufacturing
In a earlier put up, I described how fertilizer is manufactured and the way it harms the atmosphere, from manufacturing unit to farm. I additionally wrote about how a disruption to the fertilizer market overseas can have an effect on meals manufacturing and costs right here. Right here’s a fast rundown of the “holy trinity” of nitrogen, phosphorus, and potassium (or NPK) that farmers use within the type of artificial fertilizers:
Potash (potassium) is sort of utterly depending on imports. The US imports nearly 93 % of its potash, and about 79 % of that comes from Canada—the most important exporter of potash on the earth. As of 2015, USDA information present that about 4.75 million tons of potash is used yearly on this nation.
Nitrogen is especially manufactured in the USA. The US is among the largest producers of ammonia on the earth, roughly 88 % of which is utilized in nitrogen fertilizer manufacturing. Solely about 6 % of the ammonia utilized in fertilizers is imported.
There’s one other facet to nitrogen fertilizer manufacturing that must be mentioned: its dependence on fossil fuels. Combining nitrogen and hydrogen to provide ammonia is an extremely energy-demanding course of that’s achieved by burning fossil fuels. The emissions from this course of contribute to local weather change, and the truth that the Trump administration has imposed a ten % tariff on oil and gasoline from Canada might even have ripple results on fertilizer costs.
Phosphorus comes from phosphate rock and is mined domestically within the states of Florida, Idaho, North Carolina, and Utah. Greater than 95 % of mined phosphate rock is used to fabricate completely different types of phosphoric acid, which then change into feedstocks within the manufacture of phosphate fertilizers. The US imports about 13 % of its phosphate rock from Peru and Morocco, that are insulated (in the intervening time) from the tariffs imposed on Canada, China, and Mexico.
Many fertilizer merchandise utilized by farmers are a mixture of a number of vitamins, making it exhausting to foretell the general influence of tariffs on fertilizer costs. However one factor is obvious on the outset: as a result of our reliance on potash imports is so excessive, potassium fertilizers are prone to face the most important enhance in price. In 2023, Canada exported about $4.9 billion of potash to the USA, which is at the moment priced at round $443 per ton. A 25 % enhance would imply a rise of greater than $100 per ton (the ultimate pricing is determined by a posh internet of things).
Based on the USDA, farmers are projected to spend as a lot as $30 billion on fertilizer inputs. Any enhance in fertilizer costs will hit farmers first, adopted by the price of agricultural merchandise.
Retaliation is already taking place
The earlier Trump administration imposed tariffs on metal and aluminum imports from main buying and selling companions. In response, international locations like Canada, China, and Mexico (amongst others) responded with retaliatory tariffs—which means items imported by these international locations from the USA additionally confronted tariffs. This included agricultural and meals merchandise like meat, grains, and soybeans.
Canada and China once more imposed retaliatory tariffs on March 4—and Mexico is threatening to do the identical—on a spread of US exports. China introduced a 15 % tariff on US agricultural items together with soy and meat merchandise, and Canada imposed a 25 % tariff on all US items. Given the robust financial integration between Canada, China, Mexico, and the USA, together with a protracted historical past of commerce value a whole lot of billions of {dollars}, these actions are prone to have vital cascading impacts on the price of vitality, agricultural merchandise, and manufactured items, which is able to have an effect on farmers, companies, and, in the end, you and me—the shoppers. Any elevated price in manufacturing and farm inputs will possible be transferred to shoppers, leading to greater meals and grocery costs.
Mexico is the most important marketplace for US agricultural exports, at round $30.2 billion. Agricultural items exported to Canada whole about $28.4 billion, and China at about $22 billion. As a result of corn, dairy, meat, and soybeans represent the USA’ flagship agricultural exports, retaliatory tariffs on these merchandise might be particularly painful for US farmers.
Brief- and long-term impacts
When tariffs had been imposed by the earlier Trump administration, information point out that US agriculture misplaced greater than $27 billion in commerce with international locations that responded with retaliatory tariffs. Merchandise like meat, grains, and soybeans had been primarily affected, and this allowed different international locations to significantly develop their exports of these merchandise to the nations subjected to US tariffs. Information present that these third-party international locations gained no less than $13.5 billion from this commerce battle.
The USDA might supply reduction funds to farmers affected by tariffs, because it did throughout the first Trump administration. In 2018, the division introduced $12 billion in monetary help (known as a trade-aid bundle) for sure agricultural merchandise, adopted by a second bundle of $16 billion in 2019. It additionally established the Market Facilitation Program (MFP) in 2018 to offset the elevated price of farm inputs and lack of markets for US agricultural merchandise.
Commerce-aid packages supply reduction solely within the brief time period, and analysis has proven that tariffs have dire long-term penalties, particularly contemplating geopolitics and worldwide relations. Many farmers nonetheless have not recovered from losses incurred because of the earlier Trump administration’s commerce battle, and but the brand new administration is implementing the identical insurance policies once more. The present situation is just too fluid and quickly creating to gauge actual short- and long-term impacts, and any reduction efforts which may be provided will possible be introduced within the coming months or years as the total scale of harm is assessed.
This could be time to remodel US agriculture from rising the commodity crops which can be all the time hit first (and hardest) in commerce wars to cultivating meals that’s really nutritious and likewise advantages the atmosphere. Transitioning away from a system that’s reliant on subsidies and insurance policies that prop up the cultivation of a single crop (principally corn and soy) to rising vegetables and fruit would make tariffs on agricultural merchandise a moot level.
UPDATE (March 7, 2025): Since this put up was printed, the Trump administration diminished its tariff on Canadian potash from 25 % to 10 %, together with different merchandise from Canada and Mexico. However so long as the president continues to follow brinkmanship with US commerce coverage, the potential hurt to farmers and shoppers will stay.
On March 4, President Trump imposed tariffs of 25 % on all items imported from Canada and Mexico, and raised the prevailing tariff on China from 10 to twenty %. All three international locations have responded by implementing tariffs on US items. Moreover, on April 2, Trump is predicted to develop the tariff panorama to a number of international locations past Canada, China, and Mexico.
Tariffs are a tax imposed on items imported from different international locations. The newly imposed tariffs imply that companies importing items from Canada, China, and Mexico will now pay a tax of 25 % of the worth to the US authorities. Companies sometimes go that price on to shoppers, in the end making these merchandise costlier for all of us. My colleague Dr. Valuable Tshabalala just lately wrote a compelling weblog put up explaining how tariffs work, and the way President Trump’s tariffs will have an effect on inflation and meals costs in the USA. Tariffs are often carried out to advertise home manufacturing and consumption by making imported items prohibitively costly, however with regards to imported vegetables and fruit, there aren’t any home alternate options to sure merchandise that can not be cultivated right here due to unfavorable climate, soil, and rising situations. So if we would like avocados, for instance, we can have no alternative however to pay extra.
For fiscal 12 months (FY) 2025, present projections by the US Division of Agriculture (USDA) present that the USA is on a path to changing into an total importer of agricultural items. US agricultural exports—largely corn, soy, and meat merchandise—are projected at $170.5 billion, whereas imports are forecast at $219.5 billion. Which means that the USA is reliant on different nations for its meals provide, and jeopardizing worldwide commerce relations can have implications for meals safety.
The dimensions of this present commerce and tariff battle is broad, starting from vitality (like fossil gasoline) to automobile components, however we might be focusing particularly on imports associated to meals and agriculture.
What agricultural items will we import from, and export to, Canada, China, and Mexico?
Mexico is our largest buying and selling associate, with agricultural items imported by the USA totaling about $45 billion in 2023. In the identical 12 months, Mexico alone equipped about 63 % of our greens and 47 % of our fruits and nuts. And Mexico can be our greatest buyer with regards to agricultural exports, shopping for billions of {dollars} of corn, dairy, meat, and poultry.
Canada ranks second with regards to US agricultural exports, shopping for billions of {dollars} of baked items and contemporary vegetables and fruit. Based on USDA information, a majority of agricultural merchandise we import from Canada consists of meat, grains, and oilseeds, in addition to a key enter utilized in US agriculture: fertilizer. This important enter for the US farming system may very well be hit the toughest on this commerce battle.
China ranks third in agricultural exports from the USA after Mexico and Canada, spending billions of {dollars} yearly on US cotton, meat and meat merchandise, and soybeans. Whereas the vast majority of Chinese language items imported into the USA include manufactured items like electronics, equipment, and plastics, the United States additionally imports processed and contemporary vegetables and fruit, snacks, spices, and tea from China.
How tariffs might have an effect on fertilizer manufacturing
In a earlier put up, I described how fertilizer is manufactured and the way it harms the atmosphere, from manufacturing unit to farm. I additionally wrote about how a disruption to the fertilizer market overseas can have an effect on meals manufacturing and costs right here. Right here’s a fast rundown of the “holy trinity” of nitrogen, phosphorus, and potassium (or NPK) that farmers use within the type of artificial fertilizers:
Potash (potassium) is sort of utterly depending on imports. The US imports nearly 93 % of its potash, and about 79 % of that comes from Canada—the most important exporter of potash on the earth. As of 2015, USDA information present that about 4.75 million tons of potash is used yearly on this nation.
Nitrogen is especially manufactured in the USA. The US is among the largest producers of ammonia on the earth, roughly 88 % of which is utilized in nitrogen fertilizer manufacturing. Solely about 6 % of the ammonia utilized in fertilizers is imported.
There’s one other facet to nitrogen fertilizer manufacturing that must be mentioned: its dependence on fossil fuels. Combining nitrogen and hydrogen to provide ammonia is an extremely energy-demanding course of that’s achieved by burning fossil fuels. The emissions from this course of contribute to local weather change, and the truth that the Trump administration has imposed a ten % tariff on oil and gasoline from Canada might even have ripple results on fertilizer costs.
Phosphorus comes from phosphate rock and is mined domestically within the states of Florida, Idaho, North Carolina, and Utah. Greater than 95 % of mined phosphate rock is used to fabricate completely different types of phosphoric acid, which then change into feedstocks within the manufacture of phosphate fertilizers. The US imports about 13 % of its phosphate rock from Peru and Morocco, that are insulated (in the intervening time) from the tariffs imposed on Canada, China, and Mexico.
Many fertilizer merchandise utilized by farmers are a mixture of a number of vitamins, making it exhausting to foretell the general influence of tariffs on fertilizer costs. However one factor is obvious on the outset: as a result of our reliance on potash imports is so excessive, potassium fertilizers are prone to face the most important enhance in price. In 2023, Canada exported about $4.9 billion of potash to the USA, which is at the moment priced at round $443 per ton. A 25 % enhance would imply a rise of greater than $100 per ton (the ultimate pricing is determined by a posh internet of things).
Based on the USDA, farmers are projected to spend as a lot as $30 billion on fertilizer inputs. Any enhance in fertilizer costs will hit farmers first, adopted by the price of agricultural merchandise.
Retaliation is already taking place
The earlier Trump administration imposed tariffs on metal and aluminum imports from main buying and selling companions. In response, international locations like Canada, China, and Mexico (amongst others) responded with retaliatory tariffs—which means items imported by these international locations from the USA additionally confronted tariffs. This included agricultural and meals merchandise like meat, grains, and soybeans.
Canada and China once more imposed retaliatory tariffs on March 4—and Mexico is threatening to do the identical—on a spread of US exports. China introduced a 15 % tariff on US agricultural items together with soy and meat merchandise, and Canada imposed a 25 % tariff on all US items. Given the robust financial integration between Canada, China, Mexico, and the USA, together with a protracted historical past of commerce value a whole lot of billions of {dollars}, these actions are prone to have vital cascading impacts on the price of vitality, agricultural merchandise, and manufactured items, which is able to have an effect on farmers, companies, and, in the end, you and me—the shoppers. Any elevated price in manufacturing and farm inputs will possible be transferred to shoppers, leading to greater meals and grocery costs.
Mexico is the most important marketplace for US agricultural exports, at round $30.2 billion. Agricultural items exported to Canada whole about $28.4 billion, and China at about $22 billion. As a result of corn, dairy, meat, and soybeans represent the USA’ flagship agricultural exports, retaliatory tariffs on these merchandise might be particularly painful for US farmers.
Brief- and long-term impacts
When tariffs had been imposed by the earlier Trump administration, information point out that US agriculture misplaced greater than $27 billion in commerce with international locations that responded with retaliatory tariffs. Merchandise like meat, grains, and soybeans had been primarily affected, and this allowed different international locations to significantly develop their exports of these merchandise to the nations subjected to US tariffs. Information present that these third-party international locations gained no less than $13.5 billion from this commerce battle.
The USDA might supply reduction funds to farmers affected by tariffs, because it did throughout the first Trump administration. In 2018, the division introduced $12 billion in monetary help (known as a trade-aid bundle) for sure agricultural merchandise, adopted by a second bundle of $16 billion in 2019. It additionally established the Market Facilitation Program (MFP) in 2018 to offset the elevated price of farm inputs and lack of markets for US agricultural merchandise.
Commerce-aid packages supply reduction solely within the brief time period, and analysis has proven that tariffs have dire long-term penalties, particularly contemplating geopolitics and worldwide relations. Many farmers nonetheless have not recovered from losses incurred because of the earlier Trump administration’s commerce battle, and but the brand new administration is implementing the identical insurance policies once more. The present situation is just too fluid and quickly creating to gauge actual short- and long-term impacts, and any reduction efforts which may be provided will possible be introduced within the coming months or years as the total scale of harm is assessed.
This could be time to remodel US agriculture from rising the commodity crops which can be all the time hit first (and hardest) in commerce wars to cultivating meals that’s really nutritious and likewise advantages the atmosphere. Transitioning away from a system that’s reliant on subsidies and insurance policies that prop up the cultivation of a single crop (principally corn and soy) to rising vegetables and fruit would make tariffs on agricultural merchandise a moot level.
