Trump administration proposes aid as trade tensions hit soybeans

Farmers nationwide are facing higher costs and tighter margins under tariffs imposed by President Donald Trump. To offset the strain, the administration proposed at least $10 billion in aid that could offer temporary relief to the agriculture industry.

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The Wall Street Journal reported that people familiar with the discussions said Trump is considering using tariff revenue to boost the farm economy. A senior administration official said the money would target soybean producers and other farmers hit hardest by the tariffs, with aid possibly available in the coming months.

Mounting pressure under tariffs

American soybean farmers are under increasing pressure as China pulls back from buying the crop — once one of its largest agricultural imports from the United States. The shift comes in response to the escalating trade dispute between Washington and Beijing.

Soybeans are a cornerstone of United States agriculture, planted across millions of acres in the Midwest and exported around the world. China had long been the top buyer, but retaliatory tariffs slowed demand, forcing many farmers to store crops in silos or sell at lower prices. 

The U.S. Department of Agriculture estimates that soybean farmers will harvest about 80.1 million acres in 2025, producing roughly 4.3 billion bushels at an average yield of 53.5 bushels per acre.

China shifted some of its usual soybean purchases to Argentina, taking advantage of the South American nation’s decision to suspend its 26% export tax on the crop. Reuters reported that China purchased one million tons of soybeans. 

On Wednesday, Trump said he plans to meet with Chinese President Xi Jinping in four weeks, with soybeans expected to be a central topic. In a post on Truth Social, Trump accused China of using the crop as leverage in the upcoming talks.

“The Soybean Farmers of our Country are being hurt because China is, for ‘negotiating’ reasons only, not buying,” Trump said. “I WILL NEVER LET OUR FARMERS DOWN!”

Soybeans remain critical to US agriculture

The American Soybean Association, a trade group representing farmers, emphasized the importance of China as a buyer. Over the past five years, China purchased an average of 61% of the world’s traded soybeans — more than all other countries combined.

Before Trump’s 2018 trade war, roughly 28% of U.S. soybean production was exported to China. 

This isn’t the first time Trump provided financial support to American farmers. During his first term, tariffs on China triggered a sharp drop in U.S. soybean exports, forcing the government to send roughly $23 billion in aid to offset losses. Soybean growers bore more than 70% of the financial impact, according to the USDA.

Farmer groups are now urging officials to expand domestic uses for soybeans, such as blending more soybean oil into diesel and developing new export markets to reduce dependence on China.

Midwest farmers feel the impact

Tom Adam, president of the Iowa Soybean Association, said that while many Americans and farmers supported Trump in 2024, his trade policies have been “a bitter pill” for the agriculture industry.

An analysis by Iowa State University found that reciprocal tariffs on China could cost Iowa’s soybean sector as much as $1.5 billion, highlighting the high stakes for farmers in the Midwest.

Meanwhile, U.S. customs duties reached record levels, totaling more than $149 billion in the first eight months of the year, largely from tariffs on Chinese goods.