Negotiate Before Applying Tariffs, Farm Bureau Says

The largest U.S. farm group would prefer negotiation, rather than a salvo of tariffs, as the first step in resolving U.S. disputes with other nations, said the American Farm Bureau Federation’s chief economist on Wednesday. “I think it’s important, when we’re talking about friends like Mexico and Canada, that we talk first,” said economist Roger Cryan. “And think about shooting later.”

President-elect Donald Trump, who started a trade war with China during his first term, has threatened to impose tariffs of 25% on imports from Mexico and Canada and an additional 10% on Chinese imports on his first day in office unless they reduce illegal immigration and drug smuggling. He also said the so-called BRICS group of nations would see 100% tariffs if they backed a replacement for the dollar in international trade.

Roughly one-fifth of U.S. agricultural production is exported. Mexico and Canada, the two largest U.S. export customers and the leading suppliers of food and agricultural imports, account for $4 of every $10 in cross-border trade. U.S. ag export sales shrank 6% during the Sino-U.S. trade war.

Roughly one-fifth of U.S. agricultural production is exported. Mexico and Canada are two country’s largest export customers and largest import suppliers in food and agricultural trade, accounting for $4 of every $10 in cross-border trade. U.S. ag export sales shrank 6% during the Sino-U.S. trade war.

“We really prefer negotiations first, over just imposing tariffs and withdrawing from agreements,” said Cryan during a panel discussion hosted by the American Enterprise Institute. As an example, he used the talks that resulted in the U.S.-Mexico-Canada Agreement in 2020, when Trump wanted to withdraw from its predecessor, the North American Free Trade Agreement. Agriculture Secretary Sonny Perdue brought a U.S. map to White House discussions to illustrate how withdrawing from NAFTA would hurt farm states that were Trump country, according to a frequent account.

“It seems very clear that President Trump uses tariffs as a sort of foreign policy tool, or more on a transactional basis,” said Joe Glauber of the IFPRI think tank. Trump suggests using them as a lever for action on immigration or drugs rather than traditional trade goals, such as opening markets, he said. “Agriculture has often been collateral damage in the trade wars of the past.” During the Sino-U.S. trade war, in Trump’s first term, China targeted soybeans, among other U.S. products, in retaliation, reducing market prices for the oilseed by $1.50 a bushel.

Glauber cautioned that “no one really knows” what the new Trump administration will do on trade when it takes office. Some lawmakers see the recent threats of tariffs on Mexico and Canada as a show of force ahead of renegotiating the USMCA, scheduled for review in 2026.

During his election campaign, Trump advocated tariffs of up to 20% on imported goods from all nations and up to 60% on products from China.

U.S. agricultural trade was forecast for a record deficit of $45.5 billion this fiscal year, including large deficits with Mexico and Canada.

“If we’re really interested in improving the agricultural trade balance,” said Cryan, Congress should revamp the H-2A guestworker program. The formula used to set wages for guestworkers, he said, was “essentially pricing us out of the market.” Horticultural products, such as fruits and vegetables, comprise nearly half of U.S. food and ag imports. Guestworkers, who enter the country on short-term visas, often work on produce farms.

AEI panelists said Brooke Rollins, Trump’s choice for Secretary of Agriculture, had little record on farm issues, although she grew up in rural Texas. “Brooke Rollins will have the president’s ear,” said Cryan. She led the Domestic Policy Council at the White House during Trump’s first term and a Trump-friendly think tank afterward. The think tank advocated stricter work rules for SNAP recipients.