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American farmers could ultimately feel even more pain as a result of President Donald Trump’s tariffs on Canada, Mexico and China.
The latest Purdue University/CME Group Ag Economy Barometer reading showed that almost half of farmers think a trade war leading to a significant decrease in U.S. agricultural exports is “likely” or “very likely.”
The February sentiment data comes amid worries among experts that farmers won’t be as profitable in 2025.

Soy farmer Caleb Ragland on his farm in Magnolia, Kentucky
Courtesy: American Soybean Association

Caleb Ragland, a soybean farmer in Magnolia, Ky., voted for President Donald Trump in 2016, 2020 and 2024. Now, however, he has to navigate a tariff minefield at a time when the sector is already facing major headwinds.
Ragland works with his wife and three sons and has deep roots in the community. His family has been farming on the land for more than two centuries. But over the past few years, he has seen a double-digit percentage decline in crop prices while production costs rise. Soybean futures have gone down more than 40% over the past three years along with corn futures.

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Soybean futures vs. corn futures since 2022

As pressures mount in the industry as a result of tariffs imposed by the second Trump administration — as well as retaliatory levies from other countries — he’s worried about the longevity of his business.
“My sons potentially could be the 10th generation if they’re able to farm,” Ragland, who is also the president of the American Soybean Association, told CNBC. “And when you have policies that are completely out of our control – that they manipulate our prices 20%, 30%, and on the flip side, our costs go up – we won’t be able to stay in business.”
This isn’t the first time farmers have had to deal with new tariffs. Back in Trump’s first term, the trade war with China in 2018 — a time when Ragland said the agricultural economy was “in a much better place than it is right now” — cost the U.S. agriculture industry more than $27 billion, and soybeans made up virtually 71% of annualized losses.
That trade war has caused lasting damage. To this day, the U.S. has yet to fully recover its loss in market share of soybean exports to China, the world’s number one buyer of the commodity, according to the ASA.
“Tariffs break trust,” Ragland said. “It’s a lot harder to find new customers than it is to retain ones that you already have.”

‘Insult to injury’

The White House last week imposed a 25% tariff on goods from Canada and Mexico alongside an additional 10% duty on Chinese imports.
While Trump soon reversed course by granting a one-month tariff delay for automakers Wednesday, then pausing tariffs a day later for some Canadian and Mexican goods until April 2, he said in an interview that aired Sunday on Fox News that tariffs “could go up” over time.
Tariffs on China were not included in these exemptions. China retaliated with levies of its own, which mainly target U.S. agricultural goods. Specifically, U.S. soybeans are now subject to an additional 10% tariff, while corn gets hit with an extra 15% charge.
“We’re already at the point that we’re unprofitable,” Ragland said. “Why on earth are we trying to add insult to injury for the ag sector by basically adding a tax?”
Ragland pointed out that he “appreciates the president’s ability to negotiate” and wants Trump to be successful for the sake of the country. However, he emphasized that those in the industry, especially soybean producers, don’t have any “elasticity in our ability to weather a trade war that takes away from our bottom line.”
“Folks are upset,” Ragland said about sentiment from other farmers, stressing that they all need relief through deals that reduce barriers to trade and a new five-year comprehensive farm bill – legislation that provides producers with key commodity support programs, among others. “You’re talking about people’s livelihoods,” he remarked.
Agriculture Secretary Brooke Rollins said last week that the Trump administration was reportedly weighing exemptions on some agricultural products from tariffs on Canada and Mexico. Trump’s adjusted measures Thursday included a reduced 10% tariff on potash, which is used for fertilizer.
More than 80% of American farmers’ potash needs are supplied by Canada, said Ken Seitz of Nutrien – a crop inputs and services provider based in Canada – during the BMO Global Metals, Mining & Critical Minerals Conference last month.
“As we look at the implications of tariffs for Nutrien, of course the biggest discussion is around potash, and that’s because in a market that’s kind of 10 million to 11 million tons in any given year, we ourselves supply about 40% of that market,” the company’s chief executive underscored during the conference. “We believe that the cost of tariffs will be passed on to the U.S. farmer.”

Weighing the outcomes

Even in the runup to the implementation of Trump’s tariffs, American farmers were sounding the alarm. Despite the latest Purdue University/CME Group Ag Economy Barometer reading showing that farmer sentiment overall improved in February, 44% of survey respondents disclosed that month that trade policy will be most important to their farms in the next five years.

“Usually when you ask a policy question, by far and away the most important policy is crop insurance,” Michael Langemeier, agricultural economist at Purdue University, said. “Crop insurance is right up there with apple pie and baseball. It’s a program that’s very well liked, because it provides a very effective safety net.”
“The fact that crop insurance was a distant second to trade policy speaks volumes,” he also said.
The February survey also showed that almost 50% of farmers said that they think a trade war leading to a significant decrease in U.S. agricultural exports is “likely” or “very likely.” Langemeier estimated that between mid-February and early March, there was a 33% per acre drop in net return for soybeans and corn related to the tariffs. That’s on top of the fact that 2025 was “not ending up to be an extremely profitable year before this,” he revealed.

The economist thinks there may be a bit of a downward adjustment in overall farmer sentiment in the near term. Nevertheless, a constructive consequence of the tariffs could be that they speed up the signing of a new farm bill, he said.
“Well, how in the world can you come up with the amounts for the trade payments if you don’t even know what the amounts for the farm bill are going to be,” Langemeier asserted. He expects that the new farm bill signing will take place at some point this year.
Looking to the upcoming spring season, Bank of America analyst Steve Byrne wrote in a Feb. 25 note that tariffs could lead to “more conservative purchases of crop inputs.” That would mean a risk of lower fertilizer purchases, which could affect not only Nutrien but others like Mosaic and CF Industries, the analyst noted.
Shares of those companies, as well as other farming-related stocks like AGCO and Deere, all sold off on March 3 and March 4 on the heels of Trump’s tariff announcement.
“I think we’ve seen the ag stock sell-off just because of general concerns that the farmer is going to not be as profitable this year,” Morningstar’s Seth Goldstein said in an interview with CNBC.
Over the past month, Mosaic has slid almost 8%, while CF Industries has fallen nearly 10%. Nutrien has also lost more than 1%. AGCO and Deere have fared better in that time, gaining 1.7% and 0.3%, respectively.
When it comes to how this trade war will affect American farmers in the long term, Goldstein doesn’t see that meaningful of an impact. He anticipates that global trade flows will shift and cancel each other out over the next two to three years or so.
“While there may be a near-term impact this year of soybeans sitting in warehouses without really available buyers, I think eventually we would see other countries then start to buy more U.S. soybeans,” the equity strategist said. “Maybe China buys more soybeans from Brazil, but maybe a place like Europe then buys more soybeans from the U.S., and we get … not that much difference.”
As it stands, Brazil is forecast to be the world’s largest soybean producer ahead of the U.S. for the 2024/2025 marketing year, accounting for 40% of global production in the period, per the Department of Agriculture. For corn, on the other hand, the U.S. is forecast to be in the top spot, making up 31% of global production in the marketing year.
Others on Wall Street believe that tariffs will be more consequential on trade dynamics, however.
Kristen Owen, an analyst at Oppenheimer, predicts that the duties will likely solidify Brazil becoming the primary global producer for both corn and soy, whereas the U.S. will become a sort of incremental supplier to the world.
“Brazil specifically has more capacity to grow their acreage, more capacity to grow to increase their share of the global grain trade,” she said to CNBC. “Tariffs and some of the other decisions that the administration is making just accelerate some of that.” More

Unlock the White House Watch newsletter for freeYour guide to what the 2024 US election means for Washington and the worldDonald Trump has backed down from plans to double US tariffs on Canadian steel and metal imports to 50 per cent just hours after first threatening the levies, rattling investors by intensifying the North American trade war. The move by the president comes after the Canadian province of Ontario earlier in the day suspended its own surcharge of 25 per cent on exports of power to the US, which Trump had cited as a reason for boosting tariffs on imports from Canada. The reversal marks a swift de-escalation of unprecedented trade warfare between the world’s largest economy and one of its three largest trading partners, and marks the second consecutive week in which Trump has softened planned tariffs on Canada. The US would still impose tariffs of 25 per cent on Canadian steel and aluminium imports from midnight, the White House confirmed, as part of broader tariffs on all steel and aluminium imports.In a statement released late on Tuesday, hours after Trump announced he would issue tariffs of 50 per cent on the Canadian metals, the White House said the president had “once again used the American economy . . . to deliver a win for the American people”.Ontario premier Doug Ford said earlier on Tuesday afternoon that he would suspend the 25 per cent surcharge following a “productive” conversation with US commerce secretary Howard Lutnick. Ford said he would meet Lutnick and US trade representative Jamieson Greer in Washington later this week to discuss the trade tensions.The premier’s U-turn was announced just a day after the surcharge was imposed, and came hours after Trump said the US would impose 50 per cent tariffs on Canadian steel and aluminium on Wednesday. “I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD,” the US president wrote on his Truth Social platform on Tuesday morning.The latest trade dispute sparked a further increase in volatility on Wall Street, briefly sending the US S&P 500 index sharply lower on Tuesday following a heavy sell-off the previous day. The S&P closed 0.8 per cent lower, cutting some of its losses. Shortly after his inauguration, Trump said he would impose 25 per cent tariffs on Canada and Mexico, but last week he granted a one-month reprieve for goods that met the rules of a 2020 free trade deal.The aluminium and steel tariffs are part of a separate set of duties to be imposed on producers across the world, which is due to take force on Wednesday.White House officials said the global 25 per cent tariffs on imports of the metals were intended to protect US domestic industry.Show video infoMark Carney, Canada’s incoming prime minister, described Trump’s latest escalation as “an attack on Canadian workers, families, and businesses”.Carney added that his government would “ensure our response has maximum impact in the US and minimal impact here in Canada”.The White House on Tuesday continued to dismiss widespread concerns over the market turmoil.“When it comes to the stock market, the numbers that we see today, the numbers we saw yesterday . . . are a snapshot of a moment of time,” said press secretary Karoline Leavitt.“We are in a period of economic transition,” she added.A closely tracked measure of the difference in US and London aluminium prices, called the Midwest premium, rose sharply on Tuesday, underscoring the rising costs facing American industrial groups. Futures tracking the premium, which follows prices of the metal delivered to plants in the US Midwest, rose as much as 18 per cent, according to FactSet data.Trump said that if Canada did not drop its “long time” tariffs, he would “substantially increase” levies on cars coming into the US, a move he said would “essentially, permanently shut down” the country’s carmaking industry. The president, who also suggested the US’s northern neighbour could no longer be assured that Washington would protect it militarily, added that “the only thing that makes sense is for Canada to become our cherished Fifty First State. This would make all Tariffs, and everything else, totally disappear.”Canada has strongly rejected such suggestions by Trump since his inauguration in January.Additional reporting by Steff Chávez in Washington More

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The consumer price index for February is forecast to show an increase of 0.3% for a broad array of goods and services across the U.S economy.
On an annual basis, that would put headline inflation at 2.9% and core inflation at 3.2%, moving lower but still above the Fed’s 2% target.

A person browses a grocery store following the announcement of tariffs on Canadian and Mexican goods by U.S. President Donald Trump, in Toronto, Ontario, Canada, on March 4, 2025.
Arlyn Mcadorey | Reuters

With concerns running high that President Donald Trump’s tariff policies will aggravate inflation, a report Wednesday could deliver some mildly encouraging news.
The consumer price index for February is forecast to show an increase of 0.3% for a broad array of goods and services across the largest economy in the world. That projection holds both for the all-items measure and the core index that excludes volatile food and energy prices.

On an annual basis, that would put headline inflation at 2.9% and the core reading at 3.2%, both 0.1 percentage point lower than in January.
The good news is those rates represent a continuation of a steady but quite slow drawdown in the inflation rate over the past year. The bad news is that both also are still well above the Federal Reserve’s 2% goal, likely keeping the central bank on hold again when it meets next week.
“We expect broad-based deceleration, with weaker core goods and services,” Morgan Stanley economist Diego Anzoategui said in a note. “Why still elevated? For three reasons: (1) we expect used car prices rise because of past wildfires, (2) according to our analysis, certain goods and services show residual seasonality in February, and (3) we think supply constraints keep airfares inflation elevated in February.”
The big question now is where things head from here.
Trump’s tariff moves have stirred market worries of both rising inflation and slower economic growth. With Fed officials historically more attuned to the inflation side of the dual mandate for price stability and full employment, a prolonged period of high prices could put the Fed on the sidelines for longer.

However, Federal Reserve Chair Jerome Powell and his colleagues have indicated that in their view, tariffs historically have been one-off price increases and not fundamental inflation drivers. If that’s also the case this time, policymakers might look through any price blips from trade policy and continue to lower rates, as markets are projecting this year.
Goldman Sachs economists expect the Fed to stay on hold until policy comes into clearer view, then likely lower the central bank’s benchmark lending rate by a half percentage point later this year.
“We see further disinflation in the pipeline from rebalancing in the auto, housing rental, and labor markets, though we expect offsets from catch-up inflation in healthcare and a boost from an escalation in tariff policy,” the firm said in a note.
The Bureau of Labor Statistics will release the CPI report at 8:30 a.m. ET.

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Investors fear Donald Trump’s tolerance for a steep stock sell-off is far higher than it was in his first term as they lose faith that financial markets will restrain the US president’s tariffs and spending cuts.US stocks have slumped in recent days, with the S&P 500 sinking more than 8 per cent from a record high hit less than three weeks ago, as Trump’s tariffs have triggered concerns over the trajectory of the world’s largest economy. Many investors and Wall Street banks had bet Trump would ultimately back off his most severe tariff threats and cuts to the federal government if markets respond violently, but hopes for a so-called Trump put have dimmed as markets shudder.“Markets are questioning the notion that the Trump administration would adapt policies in response to equity market volatility or economic growth concerns,” UBS told clients on Monday evening. Alex Kosoglyadov, a managing director of global equity derivatives at Nomura, said in late February “people were wondering whether [Trump] was going to take his foot off the gas pedal on tariffs and some of the federal spending cuts that were spooking markets”. “In the last couple of trading days, sentiment turned in the sense that there were very clear signs that the Trump ‘put’ either didn’t exist or was set lower than where people thought it was,” he said. The rising sense of gloom has not been limited to the stock market: Goldman Sachs and Morgan Stanley have trimmed their expectations for US economic growth on worries about tariffs, and retaliation from trading partners. Delta Air Lines on Monday evening also warned economic “uncertainty” had hit its business, prompting the carrier to sharply reduce its outlook for sales and earnings in the first quarter. The Vix index, a measure of expected volatility in US stocks, has soared from 12 to 28, above its long-term average of 20. The tech-focused Nasdaq Composite, which has surged in the previous two years, is down more than 13 per cent from its mid-December record high.During Trump’s first term, financial market turmoil was widely seen as a crucial guardrail in forcing him to reverse course on policies that were seen by investors as harmful, at least in the short term, to US economic growth. “Everyone thought the only way he backs off is if the stock market plummets,” said one trading executive at a Wall Street bank. “What people didn’t see was he’d change his narrative if the stock market plummets.” The White House doubled down on its dismissal of the financial market tumult following Monday’s steep equities sell-off.“We’re seeing a strong divergence between animal spirits of the stock market and what we’re actually seeing unfold from businesses and business leaders, and the latter is obviously more meaningful than the former on what’s in store for the economy in the medium to long term,” a White House official said.As US stocks have fallen sharply in response to the threat of tariffs against its trading partners, Trump made a big U-turn, delaying most of the levies on Canada and Mexico until April but has kept tariffs on China in place. On Tuesday, the president announced an additional 25 per cent tariff on Canadian steel and aluminium imports that will take effect on Wednesday. The move comes on top of an existing plan to impose a 25 per cent levy on steel and aluminium imports from all of America’s trading partners. US stocks extended their declines in early trading on Tuesday, with the S&P 500 down 1.5 per cent and the Nasdaq dropping 1.2 per cent.The White House on Tuesday continued to dismiss widespread concerns over the market turmoil, saying the US is undergoing an “economic transition”. “When it comes to the stock market, the numbers that we see today, the numbers we saw yesterday . . . are a snapshot of a moment of time,” said White House press secretary Karoline Leavitt.“We are in a period of economic transition,” she added.The drumbeat of comments from top Trump officials playing down fears of stock market trouble has been consistent.Treasury secretary Scott Bessent fanned investor concerns at the weekend, when he appeared to dismiss the idea that Trump would curtail some of his economic policies if the stock market were to keep tumbling.“There’s no put,” he said. “The Trump call on the upside is, if we have good policies, then the markets will go up.”Bessent also said the US economy might need a “detox period” to be less dependent on government spending.“There’s going to be a natural adjustment as we move away from public spending to private spending,” he said. “The market and the economy have just become hooked. We’ve become addicted to this government spending. And there’s going to be a detox period.”For Trump, “time is the only constraint”, said Barry Bannister, chief equity strategist at US bank Stifel. “Year one of any new administration is the time to break some eggs to make an omelette and the [Trump] administration’s ambitions are a broad revamp of the economic order.”But the risk that growth cools and inflation rises — known as stagflation — was growing as Trump pressed ahead on tariffs on America’s biggest trading partners, he added, leaving US equities exposed to a “pincer movement” of potentially slowing earnings per share and lower price to earnings ratios. “Will [Trump] have the fortitude to take serious pain? That’s an open question,” said Shep Perkins, chief investment officer at Putnam Investments. More