$37 billion! That’s the projected ag trade deficit for fiscal year 2026, according to an update this week from USDA. But, that’s a decrease from the record ag trade deficit of $43.7 billion in the previous fiscal year.
“We know that tariffs have had impacts on U.S. exports across the board,” says Dr. Darren Hudson, Director of the International Center for Agricultural Competitiveness at Texas Tech University. “Whether we’re talking about soybeans, corn—obviously, soybeans was the big loser. Corn less so, but it was a negative impact.”
However, he says the tariffs have not put a dent in consumers’ buying patterns as the demand for imported products remains high.
“The price was going up, the landed value, or price that the consumer was going to pay was going up, but so was volume. And you know, that’s a little bit strange. When you think about it that way, it indicates a bit of, you know, insensitivity of the U.S. consumer to those prices, the tariff impact on, say, your shirt that you bought at the store was small enough that people really didn’t notice that,” he says.
Hudson adds that the market remains strong for many U.S. ag products.
“On net, yes, I think the tariffs probably hurt exports some, but really are not hurting those imports coming back. So, you know, there’s some strength in that demand side, or at least consistency in that demand side.”
As of December 23, USDA now is now forecasting fiscal year 2026 ag exports at $173.0 billion, up from $169.0 billion in the August outlook.
Imports are projected at $210.0 billion, down slightly from August, narrowing the ag trade deficit to $37.0 billion, compared with $41.5 billion previously.
Earlier this month, President Trump announced a $12 billion Farmer Bridge Assistance program for farmers impacted by tariff-related market disruptions. Farmers who qualify will receive those payments beginning in late February.
Sources: USDA, NAFB News Service
