Author: Luis Ribera

Authors: ^[1]Luis Ribera, Texas A&M AgriLife Extension Service

Aleks Schaefer, Oklahoma State University

To say that it has been a very busy year for U.S. agricultural trade is an understatement. Since “Liberation Day” back on April 1, 2025, and even before that, trade has been a major news topic.  The current administration’s strategy of leveraging tariffs (combined with the sheer size of the U.S. market) to change trade relationships with the rest of the world has generated much uncertainty in nearly all markets.  Both agricultural and non-agricultural industries have reacted to the almost daily trade talk news.

U.S. agricultural exports wrapped up 2024 at $174.1 billion.  USDA Outlook for U.S. Agricultural Trade December 2025 report forecast that exports will close 2025 slightly higher than the previous year at $175.6 billion.  However, the forecast for 2026 exports is $173 billion, the lowest since 2021.  The reason for this slight decrease is both volume and value, as they are expected to decrease by 1.1% and 1.5%, respectively. A continuous decrease in soybean and sorghum exports to China are the main driver of the decrease in value of U.S. ag exports in 2025, as well as expectations for 2026.  China increased their imports of these two products from Brazil and Argentina due to the increased of U.S. tariffs on their exports.  There has been an increase in exports to other countries such as the EU, Mexico, Indonesia, and Vietnam, but not enough to offset the decrease in exports to China.

On the other hand, U.S. agricultural imports are expected to reach an all-time high in 2025 at $219.4 billion and are expected to decrease in 2026 to $210 billion.  The main reasons for this expected decrease are lower imports of horticultural products and vegetable oils.  Cocoa and products, as well as coffee and products, have increased the value of imports but reduced the volume, showing that prices of those products are expected to go up.  Hopefully, the recent announcement of tariff exceptions on some agricultural products, including beef, tea and coffee, fruit juice, cocoa, spices, bananas, oranges, tomatoes, and certain fertilizers, will help reduce their prices paid by U.S. consumers.

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^[1] Ribera is Professor, Department of Agricultural Economics, Texas A&M AgriLife Extension. Schaefer is Associate Professor, Department of Agricultural Economics, Oklahoma State University.

Recently, the Trump administration announced tariff exceptions on some agricultural products, including beef, tea and coffee, fruit juice, cocoa, spices, bananas, oranges, tomatoes, and certain fertilizers. Imports account for over ninety percent of consumption for four of these products: bananas, tea, coffee, and cocoa. Spices, tomatoes, and fruit juice also have import shares surpassing 60 percent. Meanwhile, consumption of beef and oranges have not been as reliant on imports, with a dependency totaling less than 20 percent of U.S. consumption. In 2024, the beef industry produced 12.4 million metric tons (MMT) of carcass weight equivalent beef, and the citrus industry grew 3.33 MMT of oranges. Of the 1.52 MMT of beef imports in 2024, ground beef made up nearly two-thirds at 981 thousand metric tons (TMT).

Figure 1: U.S. Import Share of Agricultural Products Relieved of Reciprocal Tariffs, MT, Five-Year Average 2020-2024

	Import Share	Production	Imports
Beef*	12.68%	12,472,000	1,810,400
Oranges	17.11%	3,332,304	687,805
Fertilizer	23.84%	39,150	12,257
Spices	60.00%	427,003	640,505
Tomatoes	69.93%	864,162	1,981,046
Fruit Juice**	69.77%	2,097415	4,840,255
Cocoa	99.00%	14,240	1,409,748
Coffee	99.82%	2,736	1,502,760
Tea	99.99%	29	205,456
Bananas	100.00%	–	5,121,292

Canada is the largest source of imported cocoa products and fertilizer for the United States, amounting to $2.77 billion and $4.73 billion, respectively, in 2024. Brazil is the leader in fruit juice exports to the United States at $1.14 billion. Mexico is the source of 85 percent of imported tomatoes, worth $3.12 billion, in the United States. Vietnam and India rank as the two leading sources of U.S. spice imports, $472 million and $410 million, respectively. As for tea, China ($118 million), Japan ($115 million), Canada ($107 million), and India ($92 million) each account for around 10 percent of U.S. imports. Brazilian coffee exports totaled $2.13 billion, and 21.6 percent of U.S. imports.

Additionally, the Trump administration has announced framework agreements with Ecuador, Guatemala, El Salvador, and Argentina, focusing on reciprocal trade and investment to boost market access and address non-tariff barriers. These agreements would remove the reciprocal tariff rate of 10 percent, 15 percent in the case of Ecuador, on the bulk of exported products to the United States from the respective country. In 2024, U.S. imports of agricultural products totaled $7.45 billion from the four countries. In 2024, imports from Ecuador totaled $3.78 billion with shellfish accounting for 35 percent of this total, with cut flowers, bananas, and cocoa each worth more than ten percent of the import value. Two products, bananas and coffee, made up more than half of the $2.9 billion imported from Guatemala. The $2.40 billion of imports from Argentina were mixed between a large group of items, with shellfish, beef, wine, and sugar making up 41 percent of the total. Finally, sugar and coffee were the leading products imported from El Salvador, together totaling $207 million of the $415 million in 2024.

Figure 2: U.S. Imports from Selected Countries, 2024

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Sources:

Buzzanell, Peter J. Rex Dull, & Fred Gray. “The Spice Market in the United States: Recent Developments and Prospects.” July 3, 1995. https://ers.usda.gov/publications/pub-details?pubid=42049.

Economic Research Service (ERS). “Fruit and Tree Nuts Yearbook Tables.” Accessed November 2025. https://www.ers.usda.gov/data-products/fruit-and-tree-nuts- data/fruit-and-tree-nuts-yearbook-tables/. Published February 25, 2025.

Foreign Agricultural Service (FAS). “Global Fertilizer Dashboard.” Online Database. https://www.fas.usda.gov/data/visualization-global-fertilizer-trade-dashboard. Online public database.

Foreign Agricultural Service (FAS). Global Agricultural Trade System (GATS). Online database. https://apps.fas.usda.gov/gats/default.aspx. Online public database accessed November 2025.

Foreign Agricultural Services (FAS). Production Supply and Distribution (PS&D). Online Database. https://apps.fas.usda.gov/psdonline/app/index.html#/app/advQuery. Online public database

The White House. “Fact Sheet: Following Trade Deal Announcements, President Donald J Trump Modifies the Scope of the Reciprocal Tariffs with Respect to Certain Agricultural Products.” November 14, 2025.

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Ribera, Luis, and Landyn K. Young. “Recent Tariff Exceptions and Trade Agreements Aimed to Reduce Food Costs.” Southern Ag Today 5(49.4). December 4, 2025. Permalink

As U.S. trade policy under this administration continues to dominate the news, there seems to be a marked shift from multilateral to bilateral trade negotiations. The current administration’s strategy to use tariffs and the size of the U.S. economy as leverage to change trade relationships bilaterally seems to be the norm lately. There are 166 countries that are members of the World Trade Organization (WTO). How realistic would it be for the U.S. to negotiate bilateral trade agreements with each of them? And a follow up question, does the United States need to have a bilateral trade agreement with each country?

The answer to the first question is probably “no” as the average duration of U.S. trade negotiations from launch date of signing is 18 months and from launch to date of implementation is 45 months (Figure 1.). Therefore, it will take too much time and resources to negotiate or re-negotiate trade agreements with all WTO members. However, to the second question, the answer is probably “no” as well; the top 10 export destinations accounts for 76 percent of all U.S. products exported (Figure 2.). The European Union (EU) is the largest market for U.S. products accounting for 17.51 percent followed by Canada, Mexico and China with 17.07, 14.51 and 8 percent, respectively. The United States has already or is currently negotiating trade agreements with all top 10 countries.

When the top 10 destination for all U.S. products are ranked by share of agricultural exports, the order of countries changes. China is the largest destination for all U.S. ag products accounting for 17.25 percent. In addition, agricultural products account for 23.98 percent of all U.S. products that China imports from the United States. The second largest destination is Canada where 15.38 percent of all U.S. agricultural products end up, and those agricultural products account for 10.01 percent of all U.S. products exported to Canada. To finish the top three, Mexico accounts for 14.99 percent of all U.S. agricultural products exported while agricultural products account for 11.49 percent of all products the U.S. exported to Mexico. These top 10 countries account for 71 percent of all U.S. agricultural exports.  Due to the latest trade tensions, China is no longer the top destination for U.S. ag exports but is now third behind Mexico and Canada.

References

Foreign Agricultural Service (FAS). Global Agricultural Trade System (GATS). Online database. https://apps.fas.usda.gov/gats/default.aspx. Online public database accessed October 2025. 

Freund, Caroline & Christine McDaniel. “How Long Does It Take to Conclude a Trade Agreement With the US?” Peterson Institute for International Economics. July 21, 2016.

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Ribera, Luis A., Landyn Young. “Can the U.S. Move from Multilateral to Bilateral Trade Agreements?” Southern Ag Today 5(42.4). October 16, 2025. Permalink

Since “Liberation Day” back on April 1, 2025, and even before that, trade has been a major news topic.  The current administration’s strategy to use tariffs and the size of the U.S. economy as leverage to change trade relationships with the rest of the world has generated a lot of uncertainty in the market.  Both ag and non-ag industries have reacted to the almost daily trade talk news. Arguments for and against tariffs are all over the place, with the main question being, who is going to pay for the tariff hikes? 

To better address this question, it is important to differentiate between short- and long-term effects as the market adjusts to news regarding tariffs. Tariffs are a tax imposed on imported goods and services.  Sellers will do their best not to pass the tax to the consumers as that will probably reduce the quantity demanded and potentially reduce their market share to competitors less affected by tariffs.  Therefore, to keep their market share, sellers might absorb some of the impact of the tariffs in the short run waiting for the results of trade negotiations.  However, if sellers believe that the new tariff rates will remain in place for the long run, they might decide to pass the cost of the tariffs to consumers as their profit margins are probably reduced.

To illustrate, Table 1 shows the monthly percent changes in CPI for all urban consumers, which shows that there has not been a major change in CPI after “Liberation Day.”  The latest figures for July 2025 show that the CPI for all items is 0.2 percent, while food remained unchanged and energy decreased 1.1 percent.  In addition, the un-adjusted 12-month CPI ending in July 2025 shows 2.7 percent for all items, which is within normal ranges, especially coming off a historic high inflation over the last couple of years.  Food items went up 2.9 percent, with the largest increase being in food away from home at 3.9 percent, while energy went down by 1.6 percent. Will this continue over the intermediate- and long-run? Only time will tell.

Table 1. Percent Changes in CPI for All Urban Consumers (CPI-U): U.S. city average

	Seasonally adjusted changes from the preceding month
	Jan. 2025	Feb. 2025	Mar. 2025	Apr. 2025	May2025	Jun. 2025	Jul. 2025	Un-Adjusted 12-month*
All Items	0.5	0.2	-0.1	0.2	0.1	0.3	0.2	2.7
Food	0.4	0.2	0.4	-0.1	0.3	0.3	0.0	2.9
Food at home	0.5	0.0	0.5	-0.4	0.3	0.3	-0.1	2.2
Food away from home	0.2	0.4	0.4	0.4	0.3	0.4	0.3	3.9
Energy	1.1	0.2	-2.4	0.7	-1.0	0.9	-1.1	-1.6
Energy commodities	1.9	-0.9	-6.1	-0.2	-2.4	1.0	-1.9	-9.0
Gasoline (all types)	1.8	-1.0	-6.3	-0.1	-2.6	1.0	-2.2	-9.5
Fuel oil	6.2	0.8	-4.2	-1.3	0.9	1.3	1.8	-2.9
Energy Services	0.3	1.4	1.6	1.5	0.4	0.9	-0.3	7.2
Electricity	0.0	1.0	0.9	0.8	0.9	1.0	-0.1	5.5
Utility (piped) gas service	1.8	2.5	3.6	3.7	-1.0	0.5	-0.9	13.8
All Items Less Food and Energy	0.4	0.2	0.1	0.2	0.1	0.2	0.3	3.1
Commodities Less Food and Energy	0.3	0.2	-0.1	0.1	0.0	0.2	0.2	1.2
New vehicles	0.0	-0.1	0.1	0.0	-0.3	-0.3	0.0	0.4
Used cars and trucks	2.2	0.9	-0.7	-0.5	-0.5	-0.7	0.5	4.8
Apparel	-1.4	0.6	0.4	-0.2	-0.4	0.4	0.1	-0.2
Medical care commodities	1.2	0.1	-1.1	0.4	0.6	0.1	0.1	0.1
Services less energy services	0.5	0.3	0.1	0.3	0.2	0.3	0.4	3.6
Shelter	0.4	0.3	0.2	0.3	0.3	0.2	0.2	3.7
Transportation services	1.8	-0.8	-1.4	0.1	-0.2	0.2	0.8	3.5
Medical care services	0.0	0.3	0.5	0.5	0.2	0.6	0.8	4.3
*Ended July 2025 Source: Consumer Price Index Summary, U.S. Bureau of Labor Statistics (BLS)

References

Bureau of Labor Statistics. “Consumer Price Index Summary.” Economic News Release. Published August 2025.

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Ribera, Luis, and Landyn Young. “How is the Consumer Price Index Impacted by Trade Talks.” Southern Ag Today 5(34.4). August 21, 2025. Permalink

Over the past few decades, international trade has undergone significant transformations as countries strive to lower barriers and create a more interconnected global economy. While reductions in tariff rates have been a welcome advancement, the complex landscape of non-tariff measures (NTMs) has added new layers of challenges to achieving freer trade. Understanding how these policies impact trade dynamics is essential for navigating the ever-changing world of global commerce.

Since 1996, the average most favored nation (MFN) tariff rate for World Trade Organization (WTO) member countries has fallen by nearly half, from 13.2 percent to 7.4 percent in 2021. MFN rates are given to all WTO members unless an agreement allows for a lower rate to be given, this would be the trade-weighted effective rate or preferential rate. When comparing simple average rate to the trade-weighted MFN rate there was a 3.7 percent spread in tariff rate during 2021. The trade-weighted effective rate brings the world average down even further, to 2.5 percent in 2021. While the overall reduction of tariff rates is good news for reducing trade barriers, non-tariff measures (NTMs) play a major role as well.

Applied tariffs are the actual rates charged on products whereas bound tariff rates are the maximum upper bound that can be applied on a product without having to compensate the affected party. All rates discussed throughout this article are applied and include both ad valorem as well as ad valorem equivalents for non-ad valorem tariff rates. 

NTMs are policy measures other than tariffs that can affect international trade such as regulations, standards, and procedures, impacting quantity traded, prices, or both. In 1994, a total of 293 NTMs were in place between all WTO countries. These included 264 anti-dumping policy lines and 29 countervailing lines. These have grown drastically over time with the largest increase being the growing number of Sanitary and Phytosanitary (SPS) policies. While SPS measures are tracked through 2021, limited data exist on NTM.  In 2021 a total of 20,726 SPS measures were in place for WTO markets, a 134 percent increase from 2010.  In addition, in 2018 there were 1,858 dumping reported. This rapid increasing trend of NTMs should be a concern for those of us that support freer trade.

In recent decades, the reduction of tariffs has significantly opened up opportunities for U.S. trade. However, the increasing prevalence of NTMs highlights the need for continuous monitoring and policy adjustments to foster a truly free trade environment.

Source

Snoussi-Mimouni, Monica and Edvinas Drevinskas. “Tariffs applied by WTO members have almost halved since 1996”, World Trade Organization. April 2023.

World Trade Organization. WTO Stats. https://stats.wto.org/. Online public database. Accessed March 2025.

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Ribera, Luis, and Landyn Young. “Understanding Trade Barriers: Tariff and Non-Tariff Measures.“ Southern Ag Today 5(14.4). April 3, 2025. Permalink