KANSAS CITY, MO. — Surpassing the mark of 270 electoral college votes for presidency, President-elect Donald Trump declared victory over Democrat candidate Vice President Kamala Harris on Nov. 5.

Agriculture has not been front and center in this election cycle, and neither Trump nor Harris has succinctly outlined policy objectives, said grain industry analysts interviewed by World Grain, sister publication to MEAT+POULTRY. While the election results provide some footing for the forecast of agriculture, analysts are still uncertain what to expect in the next four years.

“A Trump administration, which wants to remove regulation, would be welcomed by agriculture and be helpful, but at the same time, the churn of activity may be a little unsettling,” said Stephen Nicholson, executive vice president, global sector strategist, grains and oilseeds, Rabobank.

Corn futures markets went up following both the 2016 election of Trump and the 2020 election of Joe Biden, he said.

“The markets are pretty agnostic at that level,” Nicholson said. “It’s a combination of things. You don’t know what kind of makeup you’re going to have in Congress, you don’t know who the leaders of the Senate and House ag committees are, who the secretary of agriculture could be or the leader of the EPA.”

It is possible to look back at Trump’s first term and at the current Biden-Harris administration to make an educated guess on what the future might hold. But as a second-term president, Trump won’t have re-election in mind when creating policies.

Trump learned from his first term and understands the levers of government better and where the pressure points are, Nicholson said.

“He’s going to bring people into his administration who have not been mainstream Republicans but are very loyal to him and his policies,” he said. “You worry about whether the new administration would be a lot more ideological.”

In his first term, during the trade war with China, Trump gave farmers a lot of money to offset their losses as exports to China plummeted.

“He doesn’t have the same incentive to do that this time because he doesn’t have to get the votes the second time around,” Nicholson said.  

Trade and tariffs

Trump vowed to be even more assertive with China if elected, calling for 60% tariffs across the board on Chinese goods. Since 2018, after Trump set tariffs on $30 billion of Chinese goods and China retaliated, the US share of Chinese soybean imports dropped from 40% to 18%.

At the same time, Brazil’s share has grown to 76% from 46%, according to Chinese customs data. China also has purchased more soybeans from Argentina, Ukraine and Australia.  

With more Trump tariffs, the United States can expect additional retaliation from China, with agricultural products at the top of the list, Nicholson said. Some economists say overall US-China trade could plunge an additional 70% from the already reduced levels.

The impact is hard to gauge, said Tanner Ehmke, lead grain and oilseed economist for CoBank, because the extent of the tariffs and possible retaliation is unknown.

“The Chinese are sitting on a record stockpile of soybeans, so that gives them leverage in trade negotiations,” Ehmke said. “At the same time, they’re leaning more on Brazil. Perhaps they don’t necessarily need much retaliation with the US, when they’re already moving away from the US and have their needs met for the near term.”

The United States-Mexico-Canada agreement (USMCA) is up for renegotiation in two years, which means, with Trump in office, he will be able to rewrite trade with Mexico and Canada, said Ehmke.

Trump has made statements about border security, immigration and tariffs on car imports from Mexico.

“We don’t know what kind of retaliation we might see from Mexico,” Ehmke said. “They are very reliant on the US.”

The National Grain and Feed Association (NGFA) advocates for a global, open market and welcomes working with a Trump administration on priority issues, said Stephanie See, vice president of legislative and public affairs for the NGFA.

These include preserving China’s permanent normal trade relations (PNTR) status, collaborating with the European Union on sustainability regulations, and continuing to engage with North American partners on non-scientific barriers to trade such as Mexico’s ban on GMO corn. 

“We must also continue to look for and pursue new trade opportunities that can benefit US agriculture,” See said.

Regulatory climate

Trump has been clear about wanting to dramatically change the regulatory structure, so upheaval is expected. Whether regulations are added or taken away, there’s always unintended consequences that must be dealt with, Nicholson said. 

The NGFA said regulatory actions can have major unintended consequences for the agriculture industry. 

“In the midst of an already severe labor shortage, additional feed, labor, environmental or transportation regulatory requirements followed by additional equipment, training and recordkeeping would create yet another barrier to hiring much needed and scarcely qualified full-time, part-time and seasonal workers in the grain, feed, processing, milling, export and transportation industries,” See said.

At the same time, there’s been talk about what role, if any, former independent presidential candidate Robert F. Kennedy Jr. would play in a Trump administration. Kennedy has been critical of pesticides, processed foods, seed oils such as soybean oil, claims that corporate interests have hijacked dietary guidelines and has made statements that the United States needs to get out of pesticide-intensive agriculture, Ehmke said. 

“What does that mean if he’s involved in Trump’s administration?” he said. “When he’s making statements that aren’t friendly about agriculture, you have to wonder where that potentially could go.”

Nicholson said it’s difficult to reconcile Trump supporting deregulation with Kennedy talking about putting different regulations in place. 

“My one big concern would be an environment of uncertainty,” he said. “That’s not good for markets and not good for companies overall.”

Ukraine 

The incoming president’s response to the ongoing war between Russia and Ukraine also could have implications for the agriculture industry. During his campaign, Trump has said he can solve the problem tomorrow.

“We don’t know what that means; he’s short on specifics,” he said. “Looking back at this behavior and his connection to Putin, you have to be concerned about Ukraine’s future.”

Agriculture production has been irreparably harmed in Ukraine, with the United Nations predicting 8 million to 10 million hectares will not come back into production, at least in the near future. It’s questionable whether Russia would invest in fixing it.

Under the scenario where Trump “fixes the problem,” that could include getting the Black Sea ports back on line, Nicholson said.

“That would at least start moving grain and oil a little more efficiently, so that would be good for the markets,” he said.

Biofuels support

Trump has made statements in support of biofuels but also has mentioned undoing a lot of the climate initiatives from the Biden administration, including the Inflation Reduction Act (IRA).

The IRA, which extended biofuels tax credits and added incentives, was behind much of the biofuels build-out in the United States, Ehmke said.

“Biofuels are not going to go away,” Nicholson said. “They’re not going to have as much favor in a new Trump administration …”

Uncertainty

From a global point of view a Trump administration brings a lot of uncertainty, Nicholson said.

“The uncertainty of the US and its action does give a lot of our international allies, businesses and enemies, a lot of indigestion on a daily basis,” he said.

In a second term, the guard rails tend to come off, Ehmke said.

“Trump believes in trade protectionism to the core,” he said. “He’s been saying these statements for decades; he’s not kidding. I think he probably feels like he has unfinished business with China and Mexico.”