What’s in store for US and Canadian farmers in the second Trump administration?
Every federal election in any country changes things for farmers, and the re-election of Donald Trump as the 47th President of the United States is no exception. The impact will be felt by farmers inside the US, but also in Canada and beyond.
US farmers are always very concerned about who will become Secretary of Agriculture. Kentucky Congressional Representative Thomas Massey, who ran unopposed on election day, is the leading consideration for this position. Massey is an MIT-trained engineer with a hobby farm, who has a strong focus on transparency and accountability in government. In a statement released to the Kentucky Herald-Leader, Massey stated after the election that “President Trump’s resounding victory secured a mandate for big ideas like reversing chronic disease, conserving our land and empowering American farmers.”
Massey is also “the sponsor of the PRIME ACT, which, if pushed through, would be the biggest shot across the bow of the entrenched industrial meat processing system that we’ve seen in a century,” according to Joel Salatin, a well-known pioneer of regenerative farming who has accepted a position to be on the advisory team to the new Agriculture Secretary. “Let liberty ring. Wouldn’t that be a change of fortune for Big Ag?”
Salatin is hinting (as Robert F. Kennedy has recently warned with regard to his upcoming stripping down the overall power and market control of ‘Big Pharma’ over US health care) that small American farmers, meat processors and more will receive more support from Trump, which will make them more powerful against large corporate firms. This will likely mean that products like farm-butchered meat and raw milk may take substantial market share from conventional meat and milk sales.
More power for small farmers?
For those following the campaign closely and seeing Trump’s strong support for health, cutting red tape and providing more consumer choice, the offer to someone like Salatin to join the new administration was logical and expected. However, as Salatin expresses excitement about small farmers having more power, cattle breeding website The Bullvine notes that small-scale farmers of all types in the US could face heightened competition as larger enterprises leverage the expected deregulation and tax savings that Trump is expected to introduce.
Either way, The Bullvine believes Trump’s plans will invigorate the entire farming industry. “By reducing tax burdens, farmers might reinvest savings into sustainable practices or expand their operations, fueling growth and innovation.”
Cutting red tape
Dr Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University and Canada’s best known agri-food industry commentator, also noted in a column after the election that Trump plans to boost the competitiveness of American farmers. Under his first term, Trump rolled back more than 100 regulations related to farming, many of which were reinstated by President Joe Biden, Charlebois explained. Many of these regulations will again likely be removed.
The Bullvine also notes that “a renewed focus on rural infrastructure” under a second Trump presidency could provide farming regions of the country with much-needed resources: “Transportation, broadband and energy investments could drive operational efficiencies and open new markets. Infrastructure enhancement can bridge the urban-rural divide, enabling farmers to sell products more effectively and participate more robustly in the digital economy.”
Canadian concerns
Charlebois notes that as Trump will ease the tax and regulatory burden on US farmers, costs for Canadian farmers have risen steadily. “Since 2019, Canada’s wholesale food prices have increased almost 40% more than in the US, putting Canadian producers at a disadvantage and complicating their ability to compete,” he notes. “A second Trump administration could widen this gap further, intensifying the pressures on our agricultural sector.”
He adds: “When Trump resumes office, Canada’s carbon tax — already controversial — may strain cross-border trade dynamics. Since 2019, Canada’s carbon tax has grown from $20 per tonne to a projected $95 per tonne by 2025, drastically increasing the cost burden on Canadian agriculture.”
Other aspects of trade
Regarding trade with Canada and all other countries, Charlebois notes that the BRICS nations (Brazil, Russia, India, China and South Africa) continue to strengthen their position against Western powers and that both the US and Canada must conduct affairs, including trade, with care.
Canada must confront a transactional approach from a Trump-led US, one that may bring both predictability and hard-nosed negotiations.”
He notes: “Canada must confront a transactional approach from a Trump-led US, one that may bring both predictability and hard-nosed negotiations.” A renegotiation of NAFTA (the North American trade agreement) is expected and could mean that sensitive Canadian farming areas like supply-managed chicken and dairy production will be up for discussion The proposed Bill C-282 (an attempt to protect Canada’s supply management systems from future trade deal concessions put forth 2 years ago by one of Canada’s opposition parties) may never be passed into law in light of the fact that Canada could face immediate pressure from Trump to repeal it.
The US dollar
It is uncertain how the US dollar will perform under a second Trump term. Many factors are at play – the US debt is colossal, it may not be used as the so-called global ‘petrol dollar’ in future, future Treasury Bill sales and purchasing levels are uncertain, and so on.
One commentator has noted that a stronger US dollar makes US grain more expensive overseas, “while tariffs proposed by Trump could disrupt US agricultural trade, with soybeans particularly reliant on sales to leading importer China. There are also fears that China could respond with retaliatory measures, potentially reducing US exports of key crops and creating downward pressure on prices.”
Due to a variety of reasons, over the last few years, China has shifted to buying more pork and beef from Brazil, Canada and elsewhere instead of the US, and more grains and beans from Brazil as well. China is also now rebuilding its national pig herd after the decimation from widespread African Swine Fever. Canada has had its fair share of tensions with China during the Trudeau administration of Justin Trudeau, and the trade relationship continues to be fragile. How it will be affected by a Trump-led US remains to be seen.
With regard to US-China trade, Bloomberg quotes analysts who say there could be more export demand under Trump than there has been in the recent past, “with China potentially making goodwill purchases” of US agricultural products in the near-term “in the event of trade negotiations under a Trump presidency”.
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