Weak Prices Squeeze Farmers, While Tariff Aid Gains Momentum

Harvest is underway, but there’s still uncertainty about where some of those crops will go. Agri-Pulse Newsmakers asked Sen. John Hoeven, R-N.D., if he thinks the U.S. is losing valuable global markets and how bailout trade aid payments for farmers could be funded through tariff revenue.

Also on the show, Virginia Houston, with the American Soybean Association, and Joe Glauber from the International Food Policy Research Institute discussed what China’s recent soybean purchase from Argentina means for the U.S. and if it’s concerning to not see an October World Agricultural Supply and Demand Estimates report because of the government shutdown.

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Lydia Johnson: Welcome to Agri-Pulse Newsmakers, where we aim to take you to the heart of ag policy. I’m your host, Lydia Johnson. Our guest this week is North Dakota Senator John Hoeven, who joins us discuss the government shutdown and payments for farmers impacted by the trade war.

But first, here are this week’s headlines.

Nearly half of USDA employees were furloughed this week. Many of the department’s activities halted as a government shut down on Wednesday. The shutdown was the result of a congressional stalemate over funding the government for the new fiscal year that started Wednesday. The Agriculture Department shutdown plan called for suspension of payment and disaster assistance, processing and data collection for many USDA published reports. The department indefinitely delayed release of the monthly World Agricultural Supply and Demand Estimates report that was due to be released on October 9th.The shutdown hit farmer facing agencies particularly hard. About two thirds of Farm Service Agency employees and 95% of Natural Resources Conservation Service employees were furloughed.

Employers could save an estimated $2.5 billion each year, with a new methodology for calculating H-2a wage rates released by the Labor Department. In an interim final rule. The department said it will no longer base the adverse effect wage rates on the Agriculture Department’s farm labor survey, but rather the Occupational Employment and Wage Statistics Survey from the Bureau of Labor Statistics. The USDA announced earlier that the Farm Labor Survey would be discontinued. The National Council of Agricultural Employers said the move will bring ag wages back to reality. Visas authorized under the H-2a program have grown from just 90,000 in 2012 to over 384,000 in fiscal year 2024.

Congress is working on lifting key restrictions to use tariff revenue to fund trade aid to bail out farmers impacted by trade wars. The Trump administration wants to use its authority under a depression era law known as Section 32, that’s funded through tariffs to fund the payments. It’s traditionally used to buy commodities for nutrition assistance programs, but the law also authorizes making direct payments to farmers of up to $350 million, according to the Congressional Research Service, to restore farmers purchasing power. While an estimate has not been made on how much funding will be needed for a bailout, some key lawmakers say at least $20 billion could be necessary.

Prices are plummeting for North Dakota soybean growers. We asked North Dakota Senator John Hoeven what he’s hearing from his constituents about the state of the farm economy and why relief payments are necessary this year.

John Hoeven: Yeah. Real concern. And not just soybeans, but the other crops, too. The commodity prices are really down. Obviously, and we’ve got a good crop coming, in the one big beautiful bill, we did update, reference prices, which is critical as well as make crop insurance better and more affordable. But that really kicks in next year, even though that’s the 25 assistance, it doesn’t get to our farmers until next fall. And so right now they’re in a tough spot. And of course, then you also have as I know we’re going to discuss the Chinese retaliating, which is exactly what they did the first time, in the negotiation with President Trump. And that’s why it’s so important that we continue to take steps to get our farmers through this stretch until we can get access to these markets and the sales that we need, which, of course, over time improves those commodity prices as well.

Lydia Johnson: I want to dive a little bit into those trade aid payments, and then we’ll circle back to China. But President Trump has said that he wants to use tariff revenue to fund those payments, to support crop producers and market relief. Section 32 is one option to do this. I mean, can you explain how that would work and how that would work to get payments to producers?

John Hoeven: Right. And there’s a lot we’ve been doing a lot of work on this. And so people need to understand that it’s not just one thing. I mean, one, we’ve got to keep working for sales. And that’s why, you know, I’ve talked with, Secretary Bassett, with USTR. Jamison Greer actually had dinner last night with Ambassador David Perdue. We’re working very hard with the administration to get sales. Also, we need year round E15. That just makes sense for, for corn and for domestic, sales here. And then as far as providing assistance, and again, like I discussed, this is about getting our guys through to next fall when the enhancements to our PLC really kick in. And that will be assistance on a longer-term basis, the countercyclical safety net. But we do need to do something now. And so we’ve been working to make sure that USDA and the administration has good options. And as you’ve seen, they’re looking at, probably making an announcement on something next week. We’ve made sure that they have, you know, good options to do that. The first time around, we use the Commodity Credit Corporation, and we could still do that. Now, again, there are cash flow aspects to it. The dependent depending on who you ask. We’ll give you kind of different interpretations on that. So, I want to be careful. But that is something that’s in my ag committee and we’re very familiar with it. We’ve used that in the past. There will be additional constraints on that or needs for that with the higher reference prices. So, we’ve also then, as you said, been looking at Section 32, which essentially is using some of the tariff revenue that’s coming in to help our farmers. And as you seen, the president has referenced that. And it makes a lot of sense because we are bringing in tariff revenues, but the Chinese are retaliating against our farmers. So, use some of that for ag assistance. Just makes sense. And it also sends a very clear message to the Chinese that we’re going to keep our farmers in the game, and they better quit using our farmers, you know, as a tool in this negotiation and I think strengthens President Trump’s hand in those negotiations, as far as China.

Lydia Johnson: And you mentioned you had dinner with Ambassador David Perdue. He raised the issue of China’s, you know, unfulfilled purchase commitments in 2020 and 2021. In a meeting with senators earlier this week, I’m wondering if you could detail that in any conversation he’s had with the president about those payments.

John Hoeven: Remember how this worked the first time around? President Trump entered into these negotiations to get us better trade terms. The Chinese immediately retaliated against our farmers. And so, we put together — and I was chair of Agri Prospect at that time, too. So, we put together the market facilitation program, and that was about 12 million, 12 billion the first year in about 14.5 billion the second year, so roughly 26 billion. But over that time, President Trump made clear to the Chinese that we’re going to keep our farmers in the game and we’re going to win this negotiation. And sure enough, you negotiate a deal for $50 billion in, add commodity sales to the Chinese. As you said, they didn’t fulfill that because during the Biden administration, he didn’t fully enforce it. But you saw that agreement and the other deals that President Trump negotiated gave us some good farm prices and good export sales, as a result of his work. And that’s what he’s, working on to do again. And it’s not just President Trump. It’s his whole his whole team. Secretary Rollins, Ambassador Perdue, you know, the whole team. And we are working to make sure that we have those tools ready to go. Once the administration decides that it’s time to go.

Lydia Johnson: Farmers are worried that they’re permanently losing valuable markets since China has found other suppliers for soybeans and other commodities. We asked North Dakota Senator John Hoeven if he’s concerned farmers are going to get those markets back.

John Hoeven: I believe they will. And already they’re paying a buck 60 or more a bushel on soybeans to buy from South America. So they’re already paying a premium price. And they don’t like that. You can bet. You know you can be sure of that. But here’s the other point I want to make. Look how much merchandise China sells into our market. Now, what are they going to do without our market? So the idea that they are the only ones that can play hardball, that’s just not true. And, you know, they sell a lot more stuff to us than we sell to them. So they’re going to need this market if they need our market. And they better be ready to open up their market to our commodities.

Lydia Johnson: And I’m curious, what timeline are you looking at for these payments? I know said the Tuesday potential announcement next week. And could the government shutdown change or alter that timeline at all?

John Hoeven: You know, we need to get back to work. This is a good example. And there’s no reason for this shutdown. Democrats have approved a clean resolution like this one, like we’ve put on the table here. They did it 13 times during the Biden administration, and 96% of the Democrats voted for it. So, you know, I think as people understand that they’ll put pressure on Democrats to come back, and vote with us to keep government going so we can work on these kind of things. As far as the timing, the other important thing to understand, Lydia, is that, like I said, the, enhancements to our policy that we put in place, you know, that actually go goes over seven years stretch. So we’ve built the safety net now to help our farmers, but it doesn’t kick in because you have it takes about a year for those payments based on prices, you know, to actually be provided. So that that means next fall is when that assistance comes. So we’ve got this gap here. And it’s important to understand because this is a one-time thing that once we get then to the new, safety net provisions that that should kick in and we should be okay. So, that’s why we do need something, you know, before the end of this year to make sure that our guys can pay down their operating lines and then project out for next year. And again, I don’t want to just pin it on just the assistance, remember. That also means getting sales going as soon as we can. The president, and you maybe saw, Secretary Bessent, made reference to the meeting that, President Trump and President Xi are going to have in Korea at the end of the month. And so, again, we want to get those sales going hopefully as soon as possible: the E15, like I mentioned, the tax cut on the biofuels to get domestic sales. So, again, not just the assistance, but that’s going to be an important part of it.

Lydia Johnson: Thank you, Senator. And as we wrap up here, the government is shut down right now with half of USDA employees furloughed and many key reports and work at the agency being halted or paused for the time being. Are you concerned about, farmer facing programs and how those will be impacted?

John Hoeven: I think for the most part, we’re you know, we’re working. Matter of fact, USDA was up briefing our ag approps crew yesterday. I think we’re trying to work through, the programs as best we can to provide assistance where we can. And, you know, we’re in the harvest now, so our farmers are focused on that. But obviously, the longer the shutdown would go, the more problematic it is, so let’s get it done. You know, let get this CR passed, and get everybody back to work.

Lydia Johnson: We’ll be back with more Agri-Pulse Newsmakers. But first, Andrew Huneke looks at Mississippi River grain shipping concerns in this week’s Ag by the Numbers.

Andrew Huneke: Water levels in parts of the Ohio and Mississippi rivers will likely reach critically low stages soon, which means shippers will be forced to light load harvest season grain barges for the fourth year in a row. This chart shows yearly down bound grain movements of corn, soybeans, wheat, oats, barley, sorghum and rye. Down the Mississippi River from 2019 to 2025. Each section of the graph is marked into four-week periods. USDA data shows this year’s projected volumes are below the average from 2019 to 2021, where drought wasn’t a major issue. Volumes are currently slightly better than the 2022 to 2024 average, when drought was a major issue. The Mississippi River carries roughly 92% of the country’s ag exports, according to the U.S. Army Corps of Engineers. Dry conditions along the Ohio River are contributing to the problem. The Ohio typically contributes about half the Mississippi River water flow, but only provided 8% as of last week, according to the National Integrated Drought Information System for Agri-Pulse I’m Andrew Huneke.

Lydia Johnson: Harvest is beginning in the US, and China still has not made a soybean purchase from this fall’s crop. We’re joined on this week’s panel by Virginia Houston with the American Soybean Association and Joe Glauber with the International Food Policy Research Institute. Joe, we’ll begin with you. How long could this lack of purchasing from China go on? And how are you seeing the president’s policy shift trade relationships around the globe?

Joe Glauber: Yeah, I mean, this is I won’t say unprecedented, but it’s been a long time since we haven’t made a sale to China by this time of the year. I think you have to go back 20, 25 years or so or, back when we weren’t selling much to China, period. But this is, you know, in one sense, I’m surprised the markets aren’t reflecting that even more negatively. But I think there’s still some hope in the markets that we will see an agreement with China and that they’ll get into the market and start buying U.S. beans. It’s certainly not too late, but that window is starting to close. This is the time of year when we typically would sell a lot of soybeans to China. And yet we see that they are buying from other, continue to buy from Brazil, have bought some from Argentina and other sources. So, it’s a game of chicken right now.

Lydia Johnson: And Virginia, I want to get your thoughts as well. I mean, Joe mentioned China’s purchasing from other buyers, including Argentina. We saw purchase last week. Can you explain what that means for U.S. ag that China’s seeking out these other suppliers?

Virginia Houston: Well, I think it’s extremely concerning for the long-term success of U.S. soybean farmers. I mean, China is the world’s largest oilseed market. They consume about 61% of the soybeans grown across the world. So, you know, they are the largest customer in the in the world and cannot be ignored. But China is showing the U.S. in this trade dispute, this tariff conflict, that they can and will meet their soybean needs from South America. You know, Brazil’s taking up the majority of that. But as you mentioned last week, we saw a major purchase of Argentinian whole beans, which is not usually what Argentina is sending to China. When Argentina lifted their export tax briefly to, you know, have a shot in the arms of the economy. So we are seeing China strategically go to other origins because they are making a point to the administration that as long as these tariffs are in place, we don’t have to buy from you. And that really — U.S. soybean farmers are collateral damage in this conflict. And that’s really hurting their bottom lines in this farm economy.

Lydia Johnson: And, you know, this loss of export markets for U.S. commodities — I mean, soybeans in particular, but U.S. commodities across the board — do you think that this puts pressure on lawmakers, on Congress and administration to make progress on domestic demand, progress on biofuel policy as well?

Virginia Houston: I think so, and, you know, that’s something that ASA is working very hard on is and, you know, certainly biofuels policy, increasing that domestic demand for U.S. soybeans because we need more markets, better that biofuels production. You know, we were on the Hill a couple of weeks ago talking about aquaculture and how that could pose some long-term possibilities as a new market for U.S. soy. But unfortunately, just in the in the short term, we have to have a revolution with China, because if we don’t, you know, these are all great policy changes, but they are 5–10 years down the road that will help us long term, but not in the short term, unfortunately.

Lydia Johnson: Soybean prices in North Dakota have fallen even lower than during the 2018 trade war, and input costs are surging. We asked Joe Glauber with the International Food Policy Research Institute, if the economic conditions in farm country set the stage for committee leaders to advocate for trade payments.

Joe Glauber: Yeah, I mean, I think it’s very tough. It’s clearly, these producers are facing really low prices and, I think unfortunately, they could get lower. I mean, look, if you look at the differential between U.S. soybean prices in Brazil right now, they’re getting close to the magnitude that we saw in 2018. But again, unless there’s some relief, there’s going to be a lot of soybeans with not too many places to go. As Virginia said, a lot of these demand boosts and things like biofuels and other things are going to that would take a lot of time. And unfortunately, when China is 60% of the world’s — takes 60% of the world’s exports — that’s hard to send that to the remaining 40% because it’s it can’t absorb everything. So that’s very tough. And I think there will be a lot of demand, or clamoring for supplemental payments for these farmers.

Lydia Johnson: And, Joe, I want to get your thoughts as well. The government shutdown will affect USDA data collection and reporting, including for the world agricultural Supply and demands Estimates report, which measures global grain stockpiles. You spent a portion of your career as chief economist at USDA, overseeing the release of many of these reports. You know what could be the impact of not having the WASDE in October, particularly with all the global trade concerns right now?

Joe Glauber: Yeah, I know, I think, you know, this information is important and certainly, you know, WASDE it’s not the only thing the trade numbers out of commerce, you know, all these things that we track day-to-day will be very important. I think you know, on things like crop production numbers, that’s another thing. The NASS surveys being discontinued. I mean, the good news is we did just have a grain stocks report, so we have some idea of what current grain availability is, at least on the stock side. And, you know, for the Crop Production reports, I think one thing that has helped there is that we have been getting the Farm Service Agency administrative data earlier. So, a lot of the data that we normally would get in an October Crop Production report, say on things like planted area, we have a much better idea because of the fact NASS has been able to incorporate that into the earlier reports. But those reports will be missed. There’s no question.

Lydia Johnson: Virginia, as we wrap up here, the United States-Mexico-Canada agreement, known as the USMCA, calls for a review by next summer. I’m curious, how is the trading relationship between these countries shifted since Trump’s second term began, and what will ASA’s priorities be in that review?

Virginia Houston: Well, obviously, since the second Trump administration began earlier this year, we have seen, you know, tariffs put in place on Mexico and Canada over fentanyl, and then pause. And so, there’s still that ongoing, high-level tension between our governments. But for U.S. soy the U.S.-Mexico-Canada trading relationship is still very strong. Since NAFTA was entered into force in early 90s until now, having that multilateral trade agreement in place has led to Mexico being the second-largest consumer for the US soy complex that’s whole beans, soybean meal and soybean oil. And Canada is also a very large market for soybean meal. And as we see more crush capacity come online, especially in the Dakotas, we expect that market to grow. Now, USTR has an open comment period for industry to weigh in on what we would like to see changed or, maybe renegotiated in this review process that, as you mentioned, just opened up for U.S. soy. Our message is the same as it was when NAFTA was being, you know, renegotiated in the first Trump administration. Do no harm. You know, for soybeans the agreement has worked very well. We don’t have any major concerns with Canada and Mexico, but we need that agreement to remain in place for the certainty of keeping two of our top five export markets viable.

Lydia Johnson: We’ll be back with more newsmakers. But first, Andrew Huneke has more on the counties where livestock producers can apply for flood and wildfire relief to the Emergency Livestock Relief program in this week’s Map It Out.

Andrew Huneke: USDA has opened the application window for the 2023 Emergency Livestock Relief Program and the 2024 Flood and Wildlife Program. This map shows the counties where livestock producers can apply for relief. Counties approved for wildfire assistance are marked in green, and those approved for flood assistance are marked in blue. According to USDA, anyone who had increased supplemental feed costs due to a flood or wildfire that qualified as a disaster in the 2023 2024 calendar year in these approved counties can apply. Anyone outside of the approved counties looking for relief must submit additional information like disaster photos and paperwork showing significant economic losses and infrastructure damage, according to the American Farm Bureau Federation. This program requires farmers to file directly to apply, which is different than the drought and federal lands. Wildfire assistance announced earlier this year. All of these payments come from the American Relief Act of 2025. For Agri-Pulse I’m Andrew Huneke.

Lydia Johnson: Thanks for joining us for another episode of Agri Pulse Newsmakers. As world leaders prepare for Cop 30 in Brazil this November, American agriculture has a critical opportunity to shape the global conversation on sustainable food systems. Join Agripulse. On October 21st at the National Press Club for conversations on how U.S. agricultural innovation is delivering solutions, the world needs to know the newsmakers next week and check our website any time for the latest developments on all things food, farm and fuel policy for Agri-Pulse,

I’m Lydia Johnson. Thanks for watching.

Agri-Pulse is a trusted source in Washington, D.C., with the largest editorial team focused on food and farm policy coverage.