Analyst says ag trade deals key to global competitiveness despite
pressures
[July 08, 2025]
By Catrina Barker | The Center Square contributor
(The Center Square) – Illinois farmers are feeling the immediate effects
of tariffs impacting soybean exports, but an analyst says many believe
these measures could help restore America’s competitiveness in the
global market.
Samuel Karnick of The Heartland Institute explained that while Illinois
farmers had mostly finalized planting before tariffs hit, they worried
about market demand amid trade disputes.
Although quick negotiations lowered tariffs and eased some damage,
Karnick noted a bigger issue: China has been buying more soybeans from
Brazil for years, shrinking the market for U.S. farmers.
“That obviously puts pressure on U.S. soybean growers, because it
reduces the market size they’re sending to, and if they send the same
amount, then that’s going to reduce the price,” said Karnick. “They will
probably either have to ensure that the White House goes ahead and gets
China on board with U.S. soybean exports, or they're going to have to
ship other crops.”
Karnick explained tariffs can help farmers if they lead to better trade
deals. He added that the high demand for U.S. dollars makes American
goods less attractive, so lowering that demand could boost U.S. farm
exports.
“What happens is the high demand for U.S. dollars makes American exports
less attractive because people prefer holding dollars over buying our
goods. At the same time, it makes imports into the U.S. more appealing
to Americans,” Karnick said. “Because of this, there’s pressure limiting
how much we can export. What President [Donald] Trump is doing is
negotiating with other countries to lower the value of the dollar
slightly. By reducing demand for dollars, it will actually benefit U.S.
exporters.”
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Early in the season, corn awaits tending in Lenoir County off N.C.
11 at Odham Road on Sunday, May 19, 2024. - Alan Wooten | The Center
Square
Karnick explained that farmers must make critical planting decisions
once a year and then live with the consequences, even as markets
fluctuate throughout the season.
“You have one time of year when you have to make all your choices
and put all your eggs in one basket,” he said. “And the market can
change during the course of a year.”
He emphasized the importance of diversifying export markets to
provide farmers with more stability.
“If you have 100 countries importing a lot of corn from the U.S.,
and one imports less this year, others may import more,” Karnick
noted. “Expanding trade beyond just China to many countries could be
very beneficial. The challenge is making those trade deals and
ensuring they go through. We haven’t tried this before. It’s new,
but better than doing nothing.”
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