Trump's plan to slap tariffs on agricultural imports might sound good for domestic farmers, but a closer look at the US import-export gap in terms of products show that consumers will be the ones hurting when it comes to fresh fruits and vegetables as well as spirits, while retaliatory tariffs will hit farmers that export bulk commodities like soybean and corn.
Food. It has unfortunately been used as a pawn in past and present trade disputes, given its essentiality to human life.
United States President Donald Trump suggested earlier this month that American farmers were hurt by agricultural imports, and that tariffs could help them sell more products domestically.
It is true that the US is increasingly importing farm goods. Those imports have been outpacing exports for the last decade, and by a widening degree.
Countries typically import products when domestic demand exceeds domestic production, or if domestic production is nonexistent. But what the United States exports differs widely from what it imports, and it is important to examine those trends to understand where opportunities or threats may lie for US producers.
In 2024, the United States imported a record US$263 billion in agricultural and related products. The export side was valued at $191 billion, down from a record $213 billion in 2022. This import-export gap was an all-time high.
However, inflation-adjusted trade figures reveal a potential sore spot for US producers, as exports have stagnated while imports are up. Increasing global competition and shifting trade policies could be among the contributing factors.
Adjusted to 2025 dollars, last year’s US agricultural and related exports were among the lowest by value of the last decade-plus, with only 2019 falling lower. But inflation-adjusted imports were the third highest on record in 2024, behind only 2021 and 2022.
Trump said last week that the April 2 deadline for reciprocal US tariffs was still on, presumably including those that have been paused for Canada and Mexico.
When it comes to farm goods, these countries are the United States’ top two trading partners.
Last year, Canada and Mexico accounted for a third of all US agricultural and related exports, and they supplied 40 percent of all imports. China was the third largest US export destination with 14 percent of last year’s total, and Japan was fourth at 7 percent.
On the agricultural import side, Brazil and China were the third and fourth largest suppliers to the US last year, each accounting for just under 4 percent.
Consumer-oriented goods dominate both sides of US agricultural trade. Over the last three years, those accounted for 42 percent of exports and 54 percent of imports by value on average. These included items such as meat, dairy, fruits, vegetables and alcoholic beverages, as well as baked and prepared goods.
Bulk commodities are where imports and exports vary drastically, accounting for around 32 percent of all US agricultural and related exports, but only 6 percent of imports. This includes the top two farm exports, soybeans and corn, which together accounted for 20 percent of all such exports last year.
US farmers of bulk commodities, including wheat, sorghum and cotton, are often trade war targets due to the relatively high export volumes. China earlier this month slapped additional tariffs on $21 billion in US agricultural products including soybeans, the top US export of any kind to China.
The bulk commodities imported by the United States are ones that it largely does not produce, including coffee, sugar and cocoa. Coffee, a staple and arguably essential American beverage, accounted for 3 percent of all farm imports last year.
Fresh fruits and vegetables imports are increasingly necessary. In the early 1980s, some 30 percent of US fresh fruit availability was supplied by imports, but that is now closer to 60 percent.
Last year, the United States exported $7.7 billion in fresh fruit and vegetables, apples being a mainstay. Imports totaled $33 billion however, and 27 percent of that owed to avocadoes, bananas and blueberries alone.
Mexico is vital to US fruit and vegetable access, while lumber is Canada’s top offering. By value, Europe’s contribution to US agricultural imports is comparable to those of Canada and Mexico.
But trade tensions with Europe are threatening to disrupt a favorite American indulgence. Trump has floated steep tariffs on European libations in response to Brussels’ tariff threats on whiskey and other spirits from the US.
The country exported $1.77 billion of beer, wine and spirits to Europe last year, but the equivalent imports exceeded $12 billion, topped by wine.
While a nice glass of California cabernet can be perfectly enjoyable, European wine enthusiasts may want to head immediately to their local retailer to snag a few extra bottles of Chianti for their cellars, just in case.
---
The writer is a market analyst for Reuters. The opinions expressed are personal.
Share your experiences, suggestions, and any issues you've encountered on The Jakarta Post. We're here to listen.
Thank you for sharing your thoughts. We appreciate your feedback.
Quickly share this news with your network—keep everyone informed with just a single click!
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Get the best experience—faster access, exclusive features, and a seamless way to stay updated.