Administration Considers $10-14 Billion in Aid for Farmers

Action: The President is considering providing between $10 billion and $14 billion in aid to US farmers, potentially funded through tariff revenue. The plan is aimed at supporting producers, primarily soybean farmers, facing weaker exports and higher input costs. Because the use of tariff revenue for direct relief would require authorization from Congress, the plan is expected to become a key element of budget negotiations already underway.

Trusted Insights for What's Ahead^®

• US farmers are producing near-record harvests, placing downward pressure on prices for corn and soybeans. USDA in its Oil Crops Outlook: September 2025 report raised production forecast by 8.0 million bushels while also reducing the export forecast by 20 million bushels. The Marketing Year (MY) 2025/26 soybean season-average farm price forecast was also lowered by 10 cents to $10 per bushel. Overall, US soybean farmers are estimated to lose approximately $100 an acre this year.
• Producers are also facing near-record input costs as prices for equipment, fertilizer, and other materials rise. According to the Federal Reserve’s survey of farm financial conditions, farm borrower income and loan repayment rates continue to deteriorate throughout the Midwest and Plains states with weakness most pronounced in regions heavily concentrated in crop production.
• China has historically been the largest buyer of US soybeans, with the US exporting nearly 985 million bushels to China in 2024, accounting for over half of US soybean exports. However, US exports to China during the new MY 2025/2026 which began last month currently stand at zero.
• The overall duty rate of US soybeans entering China now stands at 34% following China’s 20% retaliatory tariff on top of China’s Value-Added Tax and Most Favored Nation duties. China last month purchased more than 2.5 million metric tons of soybeans from Argentina once Argentina suspended an export tax. Also in late September, the US signaled it would provide a $20 billion support package (a swap line) to help stabilize Argentina’s economy.
• Directing tariff revenues to farmers would require use of Section 32, a permanent appropriation established in 1935 under the Agricultural Adjustment Act that designates the equivalent of 30% of annual customs receipts to support the farm sector. Although Section 32 is traditionally used to purchase commodities for nutrition assistance programs, it also authorizes spending to restore the “purchasing power” of farmers. Since FY 2018, appropriations bills have capped Section 32 direct payments to farmers at $350 million.
• Public Law 119-21 (H.R. 1, 2025), also referred to as the “One Big Beautiful Bill Act” or OBBBA, included nearly $66 billion in agriculture-specific spending over the next decade, with $59 billion reserved for farm safety-net enhancements. The Administration in March used funds from USDA’s Emergency Commodity Assistance Program (ECAP) to provide assistance to farmers. The White House is considering drawing on both tariff revenues and USDA safety-net funds to finance the bailout, depending on which source can be accessed most quickly.
• The first Trump Administration in 2018 provided $12 billion in assistance to farmers affected by retaliatory tariffs from China and other major purchasers of US crops.
• Beyond the budgetary impact of the spending, impacts on consumers of soybeans should be small for this year, as payments to farmers and lost export sales would likely not affect US market prices. The real impact on the market will come as farmers decide how many acres of soybeans to plant for the next marketing year.