Farmers Show Cautious Optimism with U.S.-China Trade Deal

Last week’s announcement of a new trade and economic agreement between the United States and China, signed during President Donald Trump’s trip to Asia, has been celebrated as a major diplomatic breakthrough. Yet for many in the agricultural community, the mood is one of cautious optimism rather than celebration.

Under the deal, China will purchase at least 12 million metric tons of U.S. soybeans before the end of 2025 and a minimum of 25 MMT annually from 2026 through 2028. The pact also removes limits on U.S. sorghum and hardwood exports, and pauses tariffs that have hurt commodities such as corn, wheat, cotton, pork, beef, and dairy.

For producers, the announcement brings a sense of déjà vu. The structure of the deal echoes the 2020 Phase One Agreement, which also set purchase targets for agricultural goods and contributed to a temporary surge in exports. During that earlier period, U.S. farm exports to China climbed to $41 billion in 2022, before sliding again in the following years.

This new deal, already dubbed “Phase Two” by some observers, carries similar goals but faces steeper challenges. Global demand patterns have shifted since 2020, and Chinese feed and livestock industries have diversified their sourcing across South America and other regions.

As of mid-2025, U.S. agricultural exports to China had fallen to $14 billion, roughly half of the total reached during the height of the Phase One period. The new commitments, while welcomed, must translate into real shipments to make a meaningful impact on farm income.

Rural reaction to the deal has been mixed. Farm groups, while encouraged by the potential reopening of the Chinese market, note that promises alone do not pay bills.

“Farm Bureau is encouraged by China’s commitment to import soybean and sorghum from the United States. Trade disputes dealt a blow to farmers who have already been hit hard by high expenses and historically low commodity prices,” noted American Farm Bureau Federation President Zippy Duvall. “Today’s three-year agreement comes within days of announced trade deals with Malaysia and Cambodia, along with frameworks with Thailand and Vietnam. Expanding markets and restoring purchases by China will provide some certainty for farmers who are struggling just to hold on. We appreciate the administration for listening to the needs of America’s farmers. As additional details are made known, we look forward to evaluating how these agreements will benefit the U.S. farm economy.”

Producers remember that earlier agreements often came with short-term boosts followed by new tensions, retaliatory measures, or shifting market priorities. Many say the key test will be whether both countries follow through consistently, rather than allowing political friction to derail progress.

The trade package also extends beyond farm goods. It includes provisions for fentanyl precursor control, rare earth exports, and semiconductor cooperation, signaling a broader reset in U.S.–China economic relations. For agriculture, those clauses could help stabilize global supply chains for technology and fertilizer production — both vital to modern farming.

Still, doubts linger about whether China will follow through on its new pledges. Agricultural trade is typically among the first casualties when political relations turn sour, and few expect that dynamic to change overnight.

China’s pledged soybean buys, if fully implemented, could translate into more than $30 billion in farm revenue over the next three years at current prices. That would provide a measurable boost for the U.S. soybean sector, which has endured years of price pressure and market uncertainty.

Those are projections, not promises. U.S. exports regularly average 27 MMT annually, so the 25 MMT annual target is realistic but not ambitious. Whether China exceeds the minimum commitments, or simply meets them on paper, will determine how much difference the deal actually makes for producers.

»Related: China buys zero U.S. soy as Brazil’s supplies surge