As the August 1 deadline set by President Trump approaches, some agricultural products will face new taxes. Others will be spared by new trade deals.
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As the August 1 deadline set by President Trump approaches, some agricultural products will face new taxes. Others will be spared by new trade deals.
July 29, 2025
July 29, 2025 – President Trump announced a sweeping set of tariffs on April 2, many of which impacted major agricultural trade partners. However, shortly afterward, he paused many of the higher, country-specific tariffs proposed, leaving in place a 10 percent baseline import tax.
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Since then, there have been a dizzying number of changes to the plan. While Trump has backtracked on several other deadlines, he has said August 1 would be the final deadline for countries to negotiate trade deals with the U.S. If they failed to reach a deal, the higher rates proposed earlier would go into effect.
As that deadline approaches, these are a few of the most important things to know about how farmers and America’s food system might be affected, especially with regard to the country’s biggest agricultural trade partners: Mexico, Canada, China, the European Union, and Japan. Many other smaller markets will also be impacted.
Trade with Mexico and Canada: Since April 2, a 25 percent tariff has been in place for many goods from our closest neighbors, but imports covered by the U.S.-Mexico-Canada Agreement (USMCA) have been exempt. That includes many agricultural products like fruits and vegetables from Mexico and animal feed, grains, and meat from Canada. Trump also reduced the tariff on potash, an important fertilizer not covered by USMCA, to 10 percent. Now, he says Canada’s rate will rise to 35 percent and Mexico’s to 30 percent. The carveouts for USMCA goods and fertilizer are expected to stay in place, but that has not been confirmed. Canada has since imposed reciprocal tariffs on American meat and dairy products.
Exports to China: The U.S. is currently charging a 51 percent tax on imports from China. That could go up to as high as 145 percent if no deal is reached, but Trump has extended the deadline for negotiations, which are ongoing, to August 12. China has retaliated by imposing steep taxes on American farm goods, including corn, soybeans, wheat, cotton, meats, dairy products, and more. During Trump’s last term, commodity farmers were particularly hard hit by Chinese tariffs and the export market never fully recovered. Trump’s USDA bailed farmers out with close to $30 billion in taxpayer funds.
The EU Trade Deal: This week, Trump announced a major trade deal with the European Union that set the tax on imports from the E.U. at 15 percent instead of the 30 percent proposed earlier. While the rate is lower, the tariff will likely still drive up prices at restaurants, which buy products like wine and specialty cheeses from Europe, and could make it harder for small, independent restaurants to operate. Trump has also said the deal will benefit American farmers, but details on agricultural tariffs the E.U. has agreed to drop have not yet been shared.
The Japan Trade Deal: Last week, Trump also finalized a deal with Japan to set its tariff rate at 15 percent instead of the 25 percent proposed earlier. As part of the deal, Japan agreed to increase imports of American rice 75 percent and purchase $8 billion in U.S. goods, including corn, soybeans, and biofuels made from crops.
Brazil’s Looming Deadline: Trump has proposed a 50 percent tariff on all products imported from Brazil starting on August 1, and Brazil responded by promising to reciprocate with the same rate. Brazil sends a significant amount of coffee, sugar, and specialty foods like açai to the U.S., so the prices of those products could rise. On the flip side, it accounts for 20 percent of U.S. fertilizer purchases.
In addition to the major trade deals and tariff negotiations, the White House and the U.S. Department of Agriculture (USDA) over the last month have announced smaller deals they characterized as trade wins for American farmers.
On July 1, Agriculture Secretary Brooke Rollins said Namibia will now accept imports of American poultry products, “unlocking a market valued at $15 million.” On July 23, Rollins said Trump had negotiated access to Australian markets for U.S. beef producers, but Australia’s prime minister later said the decision to ease the restriction on U.S. beef, in place due to historic concerns around mad cow disease, had nothing to do with Trump.
Since March, the percentage of federal revenue provided by tariffs more than doubled, from about 2 percent historically to 5 percent; fiscal year revenue from customs duties topped $100 billion for the first time in June. (Link to this post.)
July 30, 2025
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