As President Donald Trump's global tariffs took effect this weekend, US farmers are facing lower crop prices and the potential loss of foreign markets.

"We're already getting below break-even at the current time," said Jim Martin, a fifth-generation Illinois farmer. "We knew it was coming. I guess we're anxious to see how things are going to eventually be resolved."

Trump's 10-percent tariff on most US trading partners, excluding Mexico and Canada, began Saturday. Higher tariffs on the European Union, China, and India will take effect Wednesday.

China, the third-largest importer of US farm goods, faces a 34-percent tariff on US products, added to a previous 20-percent levy. In retaliation, Beijing said it would impose a 34-percent tariff on American goods.

Market losses and competition

Michael Slattery, a Wisconsin farmer, said the tariffs make US soybeans less competitive compared to Brazilian exports. "There is less incentive for them to purchase US soybeans. It is cheaper to get them out of Brazil by far," he said.

China’s purchases of US agricultural products dropped 15 percent in 2023, driven by competition from South America. Slattery expects further declines in Chinese demand. "The loss of this market is a very big deal, because it’s expensive to find other buyers," said Christopher Barrett, a Cornell University professor.

Economic strain

The American Farm Bureau Federation warned that tariffs could threaten over 20 percent of farm income, while also raising the cost of essential imports like fertilizer. "Tariffs will drive up the cost of critical supplies, and retaliatory tariffs will make American-grown products more expensive globally," the group said.

The USDA found retaliatory tariffs caused $27 billion in agricultural export losses from mid-2018 to late-2019. While the department provided $23 billion in financial aid to farmers during that period, Martin likened the assistance to a "band-aid."

Martin, like other farmers, hopes for more trade deals beyond China. Slattery, preparing for further losses, called Trump’s policies "a major restructuring of the international order."