It’s virtually impossible to watch, read or listen to the news today without seeing some commentary on or reference to the current disruption and attempted overhaul of various government departments and sectors. Things are changing so much and happening so quickly these days that what might be true today may not be true tomorrow. The same goes for much of the information in this newsletter – it may be useful to you right now, but with this pace of change, it could be out of date as soon as next week. But you need to start somewhere, right? 

As we all know, the agricultural sector is no stranger to uncertainty and has faced numerous challenges in recent years, including climate change, market volatility, geopolitical tensions, shifts in consumer preferences, and much more. But now, American farmers and ranchers are facing a new kind of uncertainty from policies proposed by the Trump administration. 

Let’s take a closer look at how agriculture benefitted from President Trump’s first administration, some of the impacts we could see based on his current administration’s proposals, and what steps you can take to find more certainty in your operation. 

Past Positive Impacts

Looking back to President Trump’s first term, there were a number of changes or policies enacted from 2016 to 2020 that positively impacted farmers, ranchers and producers. These included: 

• Trade agreements, such as the United States-Mexico-Canada Agreement (USMCA), aimed to provide more favorable terms to American farmers and ranchers. 
• Tax cuts have largely been a plus to agriculture as well – including increased estate tax exemption limits. Although some of the favorable tax provisions are scheduled to sunset at the end of 2025, it’s generally assumed these will be extended by Congress. Other provisions, such as the stepped-up basis and moderate capital gains rates, can positively impact a family farm through the ability to transfer assets to the next generation without a huge tax burden. 
• Energy policies have also been mostly favorable to agriculture. Policies promoting energy independence and year-round E15 sales have helped reduce fuel costs and supported biofuel production. Clearly, there’s more work to be done in this area, especially with sustainable aviation fuel and consistency in carbon intensity measurements. 
• Relief from environmental regulations, some of which unduly burdened farmers and ranchers, also helped. 
   

Tariff Concerns

On the other hand, the current administration’s tariff and trade policies represent a more negative impact to agriculture. It seems that whenever we levy tariffs on trading partners, the first thing those partners do is retaliate with tariffs on agricultural products, making it harder for us to export our products to those markets. Reducing the global market access for our agricultural products is clearly a concern for U.S. farmers and ranchers. Additionally, depending on the tariffs that are enacted, producers may see an increase in input costs of fertilizer, chemicals, machinery and other imported items. 

The best outcome to the current trade disputes might be the creation of a lasting agreement between our trading partners that leads to long-term certainty on trade and tariff policies.

Immigration Reform and USDA Funding

Another focus of the current administration is immigration reform, and by most accounts, a majority of Americans agree on the need for this. However, agribusinesses and farmers/ranchers rely heavily on immigrant labor, which means that proposed immigration policies could have a significant impact on those and other sectors that rely on immigrants. 

USDA funding freezes have also left some farmers and ranchers without financial support that had been promised and approved. Delayed payments for producers who have signed contracts with the USDA for programs such as the Environmental Quality Incentive Program (EQIP) and the Rural Energy for America Program (REAP) are a concern. 

As a result of these funding freezes, some farmers or ranchers may be hesitant to make investments or take on additional debt without the certainty of some of these programs, including conservation and sustainability projects. We simply need to be mindful of the potential unintended consequences of these rapid cuts to government services or pauses of government funding. 

Planning Around Uncertainty

All of this uncertainty makes it hard to plan. As I always say, focus on what you can control and work to manage around all the uncontrollables. Have a plan, but be ready to pivot for different scenarios. This is a great time for producers to up their game with respect to financial management as a way to find more financial certainty. Fully utilizing technology and innovation to improve your operation’s efficiencies can also be beneficial. 

Lastly, take advantage of networking and educational opportunities to stay informed about current events. Work to stay up to date on the changes that are occurring and how they could potentially impact your operation. 

Buckle up and stay tuned. 

This article appeared in the Q1 2025 issue of Bell’s AgViews newsletter.