“The trade data make it clear that over the past 15 years, the value of U.S. agricultural exports has expanded dramatically with our three largest agricultural trading partners: China, Canada and Mexico. While a few lingering trade barriers among these countries remain in place, most have been dramatically lowered over the last 15 years, helping facilitate this substantial increase in trade. Where trade deficits for agricultural products occur with Canada and Mexico, they are small relative to the total value of agricultural trade, can largely be attributed to the rise in the value of the U.S. dollar, and the drop in the price of some of our key exports. The real threat to agricultural exports now comes from rising trade tensions with all three of these countries who are our largest agricultural markets.”
“In response to the administration’s tariffs on selected products, especially steel and aluminum, China, Canada and Mexico have announced increased tariffs on a range of goods produced in the U.S. The European Union will also respond to increased U.S. tariffs.
“Farm products and products processed from agricultural commodities, such as wine and whiskey, have been singled out. As things currently stand, with the exception of pork and sorghum, the impacts should be manageable.
“However, if the situation deteriorates, and a full-scale trade war breaks out, the farm sector could fall into a full-blown depression. The farm sector has slowly been recovering from a period of low prices and incomes during the mid-2010s, and the current dispute and concerns about a widening trade war has added uncertainty in agricultural markets.”
William Knudson, Michigan State University
Full article can be found here