Bitter Harvest: Diagnosing and Deterring Chinese Coercive Agricultural Trade Restrictions

These episodes appear to be growing more frequent. Of the 26 incidents observed, 15 occurred since 2020, and five took place in 2025 alone—more than any other year on record. Moreover, incidents in recent years have covered an increasingly large set of trade flows, partly due to the breadth of restrictions targeting the United States in response to trade war tariff hikes, but partly due to more expansive actions taken against other economies such as Australia, Taiwan, Japan, and the European Union. This trajectory suggests the risk of agriculture-related coercion is likely to remain a serious issue for agriculture industries reliant on Chinese consumers.

Beijing’s rationale is straightforward. China is the world’s largest market for agricultural goods, importing $207.4 billion worth of agriculture and seafood products in 2025. Its massive consumer demand and significant processing capabilities make it a highly appealing market for agricultural exporters around the world. Owing to these factors, at least 32 economies reported China as one of their top three agriculture export markets in 2024—more than any other country besides the United States. This gives Chinese purchasers considerable economic leverage over these exporters’ governments.

In agriculture, as in other industries, this leverage is often asymmetric. Looking at food products specifically, China relied on imports for 10.4 percent of its food consumption in 2023, but these purchases accounted for 14.4 percent of all global food imports. These ratios vary significantly when disaggregated in terms of specific products, but they mean that exporters are often more reliant on Chinese consumers than Chinese consumers are on them. Unlike other imports with fewer readily available substitutes (such as high-tech products), Chinese policymakers can restrict agricultural imports without inflicting heavy damage to their own economy.

Relatedly, agricultural import restrictions often align nicely with Beijing’s high-level strategic priorities. As other scholars have noted, Chinese leaders are reluctant to use coercive mechanisms that jeopardize strategic priorities such as technological innovation and industrial upgrading. Agricultural import restrictions dodge these issues. Better yet (in Beijing’s eyes), these restrictions can in some instances complement national priorities, namely boosting food self-sufficiency by incentivizing agricultural import substitution. This proverbial two-birds-one-stone logic is seen in China’s 2025 tariffs on European dairy, which are viewed as retaliation against EU electric vehicle tariffs but which also help China’s beleaguered, milk-focused dairy industry climb the value chain toward producing more cheese, butter, and other higher-margin products.

Given China’s propensity to respond to geopolitical affronts with blocked agricultural trade, an obvious question is whether these tactics succeed in pressuring other countries to change their policy. The answer is usually no. Out of the 26 episodes of agricultural economic coercion observed since 2010, only 10 concluded with targeted countries adjusting their policies in a way favorable to Beijing. None of the incidents resulted in a complete reversal of the targeted country’s original offending policy. Even in instances of partial appeasement, outcomes are never a result of agricultural coercion alone. Beijing typically pairs its agriculture policies with other forms of leverage, and the actions of other global players also influence whether a targeted country backs down or remains firm. These factors complicate any attempt to assess the efficacy of agriculture-related coercion.

That said, Beijing’s low success rate understates the overall impact of China’s agriculture-related coercive efforts because it does not account for the deterrence effect on other countries. Most explicit targets of China’s agricultural coercion have historically been wealthy countries that have close relations with the United States. They are inherently better positioned to weather the effects of agricultural coercion because agriculture is just one part of their large, diversified economies. Disruptions to agricultural trade are likely to be much more painful for countries with smaller, less developed, or less diversified economies. Such nations, which might otherwise protest problematic behavior from Beijing, may be cowed into silence by the implicit threat of coercion. Recent CSIS research, for instance, found that scholars from Global South countries cited fear of economic retaliation as a major reason their governments are hesitant to offer vocal support for Taiwanese autonomy. Such impacts are an indirect but important consequence of Beijing’s use of agricultural coercion.
 

What Mechanisms Do Chinese Policymakers Use to Restrict Agricultural Imports?

Chinese government actors employ a range of tools to restrict agricultural imports. The most straightforward action is to raise tariffs, which are easy to implement, easy to retract when desired, and give policymakers fine-grained control over the scope of restrictions. After Beijing levied tariffs against U.S. soybeans and other agricultural products in 2018, for instance, U.S. annual soybean exports to China dropped 74 percent relative to the prior year.

Regulatory barriers, such as sanitary and phytosanitary measures, are another commonly used mechanism. This tactic is useful for blocking imports of a given product from a given country entirely. For instance, when Chinese inspectors reportedly found pests in bananas from the Philippines in 2012 and contamination in pork from Canada in 2019, this gave the Chinese regulators banning such imports a veneer of deniability in multilateral forums—despite suspiciously coincidental timing with geopolitical flashpoints.

Unofficial do-not-purchase directives and popular boycotts fomented by state media are other mechanisms occasionally used to curtail imports. These measures each shield China’s central government from direct attribution while still achieving the desired disruptive effect. Such tactics are more commonly used to block non-agricultural imports but have been occasionally deployed against agricultural goods as well, such as Australian cotton in 2020.

The impacts of these coercive mechanisms are also shaped by the unique industry dynamics of the products they target. One added nuance comes from the seasonal cyclicality inherent to most agricultural products. Restricting imports of a given product right before it is due to be harvested can pressure the targeted country to resolve the dispute quickly or miss a critical window to sell it.

This dynamic was evident ahead of the October 2025 trade negotiations between President Donald Trump and President Xi Jinping. Their meeting took place right as the U.S. soybean industry entered its peak harvesting season, meaning that if a deal to lower Chinese soybean tariffs was not reached quickly, the U.S. industry faced acute losses. Though it is unclear whether this was part of the original plan when Chinese policymakers deployed the tariffs in April 2025, it undoubtedly increased Xi’s negotiating position heading into the October talks.

China’s agricultural economic coercion can even involve geographic targeting at the subnational level. In the lead-up to Taiwan’s local elections in 2022, Chinese authorities banned imports from Taiwan’s grouper industry, which typically sells around 90 percent of its catch to China. The ban—which added to existing ones on Taiwanese pineapples and wax apples—was felt most heavily in Taiwan’s southern countries of Kaohsiung, Pingtung, and Tainan, where production of these goods is concentrated. These regions also happen to constitute the stronghold of Taiwan’s Democratic Progressive Party (DPP), the main independence-leaning political party, which Beijing vehemently condemns. This link might seem spurious, but Chinese regulators put a finer point on the issue when they began selectively restoring export licenses to only a handful of grouper-farming companies with explicit ties to the Kuomintang (KMT), the more Beijing-friendly party that is the DPP’s chief rival. Taiwan’s Ministry of Agriculture condemned this action as a coercive effort to interfere with Taiwan’s democratic institutions.

As these anecdotes illustrate, Beijing can employ a range of policy mechanisms to apply pressure to other countries’ agricultural sectors. Yet this does not imply that any country selling agricultural goods to China is inherently vulnerable to coercion. The following section examines the factors that leave agricultural exporters exposed to such influence.
 

Toward a Framework for Assessing Exposure

In theory, Beijing could target any agricultural import when seeking to exert leverage over another country. In practice, however, most agricultural industries are not existentially reliant on China’s consumer market. A decision by Beijing to block these goods would be viewed by the exporting country as more of an annoyance than an economic crisis, making it an unlikely choice for Chinese leaders seeking to maximize their coercive pressure. In addition, certain agricultural imports are critically important to China’s own economy, and Beijing would be wary of inflicting self-harm by cutting off its supply.

This paper presents three metrics that can be used to assess the risk exposure of a given agricultural industry in a given country to Chinese economic coercion. Together, these metrics paint a picture of a country’s overall risk profile and can inform policymakers’ efforts to shore up vulnerabilities.

The first metric is the percent of a country’s total exports sold to China within a given industry. If the industry sells 90 percent of its exported products to China (as in the case of Taiwan’s grouper industry), lost access to China’s market would be devastating. If, however, China occupies only 10 percent of an industry’s export market share, its economic health is unlikely to be seriously threatened by import restrictions. The larger China’s share in a given industry’s export market, the greater its leverage when threatening to suspend imports.

The second metric to consider is China’s share of total global imports for a given industry or product. This indicates how easy it would be for a country to find other buyers for its product if needed. If China imports only 10 percent of the world’s exports of a given product, Chinese import restrictions would have only a minor impact on the total accessible market for sellers of this product; there would be many opportunities to diversify toward other buyers. If, on the other hand, China imports 90 percent of the world’s exports of a given product (effectively a national monopsony), sellers would struggle to find alternative markets. This proxy is useful but imperfect since—as discussed in the next section—pricing dynamics, transportation logistics, and idiosyncrasies of product-market fit can all pose steep barriers to diversification, even in industries where China comprises a low share of global demand.

The third metric to consider is the size of a given agricultural industry in a given country relative to that country’s overall economy. Even if an agricultural industry is heavily reliant on China and has few opportunities to diversify, it may still make up only a minor part of the country’s overall trade. Thus, damage to this industry may have little coercive influence over national government leaders. By contrast, if the industry in question plays a major role in a country’s economy, threats to it can quickly raise national-level concerns, leaving policymakers much more exposed to economic coercion.

These metrics can be combined to create a risk profile for any given agricultural industry in any given country. Figure 7 below illustrates such a risk profile for top agricultural exports of countries worldwide. Each point on this chart represents an agricultural industry or product in a given country, grouped by Harmonized System (HS) code at the HS-6 level. The chart’s x-axis shows the first metric described above: country-level export dependence on China for each given industry. The y-axis shows the second metric: China’s share of global imports for the given industry. Each dot is scaled by the size of this export industry.

This approach can be used to triage which industries in which countries are most exposed to coercion. As Figure 7 illustrates, industries in the top-right quadrant have the highest risk profile; they are highly reliant on the Chinese market and have few opportunities to diversify if needed. The vulnerability of the large U.S. soybean industry is readily apparent on this chart, which shows that around 52 percent of U.S. soybean exports go to China, whose imports of these products make up around 65 percent of the global total. Industries in the bottom-right quadrant have a moderate risk profile; they are somewhat exposed to coercion, but opportunities to diversify serve as a hedge against threats. Industries in the bottom-left quadrant have the lowest risk profile.

In addition to being useful for assessing risk exposure, this diagnostic approach can shed insight into which industries are most likely to be targeted by Chinese policymakers should a diplomatic conflict arise. Of the observed incidents of agriculture-related economic coercion, industries with higher reliance on the Chinese market, higher Chinese share of the global market, and larger export values in absolute terms are disproportionately likely to be targets of restrictions.

Yet economic factors are not the only determinants of which sectors China targets. Restrictions are often aimed at symbolic industries with local resonance. Even though Japan’s sake industry is relatively less exposed by these metrics, it was targeted nevertheless, likely in part because of its cultural gravity in Japan. French Cognac, Spanish pork, Guatemalan coffee, and Taiwanese pineapples are just a few of the other culturally significant industries that have been threatened by Chinese restrictions. Owing to the symbolic value of these industries, the nationwide political ramifications of trade restrictions are somewhat disproportionate to their material impact on the national economy—though the two factors are often interlinked.

One final nuance to consider is China’s own reliance on imports for a given agricultural industry. Just as trade restrictions require exporters to find new buyers for their goods, they may also require Chinese buyers to find new sellers or shift production locally. A high degree of import reliance does not guarantee China will avoid blocking imports of that good. China’s low self-sufficiency in soybean production has obviously not stopped it from restricting U.S. soybeans, for example, yet this restriction relied on China having alternative import sources from Brazil and Argentina and came at the cost of exposure to other kinds of business risks. If alternative sources were not available, or were only available at significantly higher prices, Chinese officials would think twice before blocking imports from a given supplier.

How Can Agricultural Producers Reduce Their Risk Profiles?

Once a country has identified which agricultural industries are most exposed to economic coercion from China, the next step is to develop a strategy for reducing their risk profile. An optimal de-risking strategy is highly dependent on specific dynamics of the industry in question, as well as its global landscape of importers and exporters. That said, this section outlines a few high-level strategies and considerations for when each may be appropriate.

Market Diversification

The first and most straightforward response is market diversification; this involves pivoting some exports away from China toward other prospective buyers. This approach can entail pursuing existing demand outside of China, which likely means competing with other sellers of the same product to capture some of their market share. This kind of market diversification strategy presumes that demand for an industry’s products exists outside of China in the first place. This is true for products in the bottom-right quadrant of the Figure 7 risk map above, but less true for products in the top-right quadrant, where China holds the lion’s share of global demand.

This strategy is aptly illustrated by New Zealand’s meat industry. After Chinese authorities restricted a swathe of Australian agriculture exports in 2020, Wellington launched a comprehensive campaign to insulate themselves against a similar threat. This included market research and technical support for businesses looking for new markets, government-backed financing for market entry initiatives, and revamped efforts to broaden trade agreements with other trading partners. These initiatives paid off. Within a few years, some of New Zealand’s most China-dependent industries—such as its meat production—had shifted to a more diversified export market.

A market diversification strategy can also attempt to cultivate new demand for specific products in regions outside of China. This avoids the need to compete with incumbents for market share but is generally a much slower and more uncertain process. Market entrants need to cultivate organic local demand, navigate health standards, and (in some cases) work with the importing country to carve out new regulatory categories. Small and medium-sized enterprises (SMEs) can find these hurdles especially daunting, raising the need for policy support like that used by New Zealand.

These measures all focus on diversifying into other export markets, but another (often simpler) strategy is to redirect would-be exports to meet domestic demand. Local growers usually know their own market best and can also save costs on export logistics. This is particularly useful for fresh foods or goods with short shelf lives, which may otherwise struggle to diversify into more distant markets. Last, diversification into domestic markets can dovetail with public health policy objectives, since locally produced foods tend to require fewer preservatives and contain more nutrients than foods that must be processed for export. Pivoting toward domestic markets may still require additional steps to reconfigure value chains, such as reducing the share of farmland devoted to export-oriented cash crops or upgrading industrial capacity, as discussed below. These measures are easier said than implemented, but the multiple potential upsides make these strategies worth considering.

A key consideration for any diversification strategy is the price exports will fetch in alternative markets. Even in industries that theoretically have access to many alternative markets, diversification can still be painful or downright unfeasible if those markets cannot pay the premiums typically associated with Chinese buyers. This is illustrated by Australia’s diversification of barley exports following trade restrictions in 2020. On paper, Canberra’s diversification strategy looks like a success: Much of the crops previously sold to Chinese customers found new buyers in Saudi Arabia. Yet this disguises the price discount Australian exporters were forced to accept when selling to Saudi importers, who predominantly used the barley for animal feed—in contrast to Chinese buyers seeking high-quality barley for beer making and who were willing to pay a premium accordingly. As this lesson shows, policymakers and industry leaders should factor pricing dynamics into cost-benefit analyses for proactive market diversification.

Processing and Value Chain Upgrading

A second strategy to reduce dependence on China’s market involves value chain upgrading. Economic policymakers often associate multistage value chains with high-tech products and other manufactured goods, but the concept is also key to many agricultural industries. Wheat grains are cleaned and milled into flour, which is used to make bread. Soybeans are processed into oil, and their byproducts are further processed into animal feed. Whole fish are sliced into fillets, which are then frozen, dried, or preserved in tins. Packaging for sale to retail distributors adds an extra step to nearly all of these value chains. These stages often do not occur in the same place. Many local industries import versatile commodities from abroad and process them to align with domestic tastes, regulatory frameworks, and logistical networks; others import fully finished products.

Value chain upgrading can play a key role in shifting export dependence away from China. One reason is that China often dominates demand for agricultural goods in their raw state but holds a smaller share of global demand for the more processed forms of these goods. One of the Chinese economy’s core competencies is refining and processing low-tech goods at scale—a characteristic often noted in manufacturing but that also applies to its agricultural sector. This dynamic is illustrated in Figure 11, which shows China’s share of global imports for unprocessed, partially processed, and fully processed products from several key agricultural industries.

Across all these industries, China’s import share is higher for unprocessed goods (in dark blue) than for partially or fully processed goods (in light blue and green). One implication is that by applying more processing steps to domestically produced goods, agricultural industries may find more opportunities to diversify away from China into new markets. This dynamic does not hold in every agricultural industry, but where it does, it can provide a useful mechanism for risk mitigation.

Another potential upside for processing goods at risk of Chinese import restrictions is that processed goods often have longer shelf life, giving producers more flexibility to find new markets or ride out the coercive episode. This lesson can be seen in Taiwan’s response to China’s ban on pineapple imports in 2021. Because fresh pineapples are highly perishable, opportunities for market diversification require nearby consumers or expensive refrigeration infrastructure. With limited access to either of these options, some Taiwanese farmers instead processed their pineapples into pineapple cakes—a quintessential Taiwanese snack that happens to have much longer shelf life—which they then marketed to consumers around the globe. Taiwanese pineapple cakes may sound like a niche case study, but similar techniques—drying, freezing, canning, curing, pickling, and fermenting—can be used across a wide range of industries to mitigate the problem of perishability.

The downside to these strategies is that launching new agricultural processing equipment is not cheap. These steps are often labor-intensive, capital-intensive, or both and typically involve a time lag before new production is ready to come online. It is up to policymakers and industry leaders to decide whether the upsides of reduced geopolitical risk are large enough to justify these trade-offs. As a final consideration for agricultural products that involve food for human consumption, processing often impacts their nutritional quality. When considering incentives for agricultural processing operations, policymakers should assess not only the economic implications of these interventions, but also the health implications.

Changes to Production Base

In instances where an agricultural economy is excessively dependent on China, has limited market diversification opportunities, and cannot benefit from value chain upgrading, a third strategy is simply to shift production toward different kinds of goods altogether. In the United States, land that is mostly used to grow corn and soybeans today could be sown with a range of other grains, legumes, or fresh fruits and vegetables. This approach essentially involves supply-side diversification, in contrast to the demand-side diversification discussed above. Such a response entails the most dramatic changes to a local economy but could be useful in reducing dependence on China—and may also provide other advantages.

Shifts in production base are a common response to geopolitical risk. In 2019, many Canadian canola farmers were blocked from exporting to China, traditionally a major market, after Canadian authorities arrested a corporate executive at Chinese tech giant Huawei. Some of these farmers pivoted to alternate buyers, but others opted to use the same land to grow different crops entirely. The bars shown in Figure 12 represent the area of Canada’s total cropland, disaggregated by choice of crop and end-market destination. As the figure shows, from 2018 to 2020, Canadian farmers converted almost 9 percent of land used to grow canola seeds into land for growing other products. In this case, Canadian farmers were adjusting their crop acreage reactively, but other countries can consider proactive changes to their production bases in areas where they are highly exposed to geopolitical risk.

Such shifts are not cheap, even when the same kind of land can theoretically be used to grow different crops. Business models, supplier and distributor relationships, equipment, fixed capital requirements, and domain expertise all tend to be somewhat crop-specific, creating friction for businesses seeking to change their acreage. This helps explain why some industries react more slowly than expected to rising geopolitical risk; cost-benefit analyses for product diversification should not underestimate these costs. Yet policymakers can ease some of these barriers by adjusting policy incentives, as discussed below.

Last, as policymakers (particularly those in Washington) consider how to reduce the risk of Chinese economic coercion, it is worth pointing out that U.S. agricultural subsidies have created structural incentives to concentrate farming in crops (particularly soybeans) that depend on Chinese buyers. This is a policy choice just as much as it is an outcome of market forces. After Beijing curtailed its U.S. soybean imports in 2018, Washington deployed $28 billion in relief packages to farmers—a pattern repeated in 2025 with an additional $12 billion bailout. The costs of such measures add to the subsidy burden already shouldered by U.S. taxpayers to maintain this commercial relationship. Soy and other agricultural exports to China have yielded benefits to the U.S. economy outside of the current trade war context, but an honest assessment of future agricultural policy should weigh these benefits against the opportunity costs of not having a more diversified agricultural sector.
 

Recommendations

Agricultural import restrictions are a convenient and impactful part of China’s economic statecraft tool kit. In an era of heightened geopolitical risk, policymakers should work closely with agricultural industries to reduce exposure to coercive pressure campaigns via lost export revenue.

This paper’s analysis does not suggest that all agricultural producers should pivot to new markets and stop selling their goods to China. Chinese demand has been an economic boon to agricultural producers around the world, and abandoning the Chinese market entirely would likely result in net economic welfare loss (in other words, making the world worse off in aggregate).

Thus, a response to rising geopolitical risk should recalibrate trade-offs between efficiency and resilience in industries with heightened exposure, rather than aim to completely remove all risk. This research suggests that agricultural industries may not be fully pricing in the emerging risks around Chinese market access (due to short-termism, supply-side market distortions, or other factors). With this context in mind, policymakers should craft potential surgical responses that address specific market failures and avoid sweeping market interventions. Four policy implications are explored in turn below.

1. Promote market diversification by easing switching costs.

Most strategies for reducing geopolitical risk in the agriculture sector come down to some form of market diversification: finding new markets for existing exports or changing the production base to unlock other sources of demand. Market diversification ultimately must be done by agricultural producers themselves, not governments, but policymakers can play an important role in reducing barriers to finding new customers. In economics terms, this is akin to reducing “switching costs” that might otherwise lock sellers into economically suboptimal commercial patterns.

Public sector actors can ease switching costs through a mix of trade facilitation and export promotion tools to help connect producers with new buyers overseas. One such tool is government-led trade missions, which introduce producers to new consumers and distributors and help them navigate novel regulatory environments. The United States, for instance, has six trade missions planned for 2026, many of which are timed to help producers take advantage of opportunities created by recent bilateral trade and investment agreements in Asia and the Pacific. Other countries can use similar strategies to support industries seeking to reduce reliance on China.

Other export promotion mechanisms involve government-provided market intelligence and technical assistance. Governments typically offer these services as part of their general trade policy, but they can advance strategic goals by explicitly tailoring them to industries with high exposure to Chinese geopolitical risk. In the United States, the USDA’s Foreign Agricultural Service runs the Market Access Program, the Foreign Market Development Program, the Emerging Markets Program, and similar initiatives, each of which could be expanded and tied to de-risking priorities. In parallel, the U.S. Department of State, U.S. Trade Representative (USTR), and USDA—and their counterparts in other countries—could complement these initiatives with public-facing country and product exposure dashboards that draw from the risk assessment framework presented in this report. The 2026 Farm Bill, which has passed the House of Representatives but is awaiting further revision, presents one opportunity for U.S. policymakers to advance these policies.

Third, governments can support market diversification efforts through targeted fiscal tools such as export financing and subsidies for switching crops or upgrading agriculture value chains. Preparing to enter new markets is a costly and risky endeavor that may take several years to pay off, but providing credit to producers to defray these risks can lower barriers to market diversification. Although agriculture export financing is a well-established service many governments already provide, it can be scaled and targeted selectively to respond to heightened geopolitical risk. In the United States, the USDA’s GSM-102 Export Credit Guarantee Program, as well as the other programs mentioned above, can be used to support entering new markets and investing in capital-intensive projects. Policymakers should ensure the risk-pricing mechanisms used in such programs take into account the geopolitical risks investigated in this report.

When designing market diversification support, policymakers should explicitly tailor these mechanisms to meet the needs of SMEs. Smaller exporters are often most vulnerable to switching-cost market failures. They are less likely to have in-house expertise to conduct market intelligence on new opportunities or to navigate novel regulatory compliance requirements, and they have less fiscal maneuverability to take risks with new market entry. As a result, government support is particularly useful for these businesses, both in communicating emerging geopolitical risks and in providing the expertise they need to react accordingly.

Finally, governments should continue the crucial work of negotiating new trade agreements and supporting working-level coordination within existing trade frameworks. Given that agricultural products are often a sticking point for trade negotiation efforts, negotiators should factor in the strategic value of market diversification when working through compromises with partners.

2. Use subsidies with caution.

Often, when agricultural exporters abruptly lose access to China’s market, the exporting government’s immediate response is to provide short-term relief to impacted farmers through subsidies and bailouts. This kind of direct relief can be a useful stopgap measure that helps farmers absorb shocks and weather brief periods of geopolitical instability. Ideally, they buy time for farmers to diversify markets and shift toward more resilient business models. That said, stopgap subsidies have serious downsides. Such measures do nothing to alter the underlying industry structures that lead to excessive reliance on Chinese consumers. On the contrary, they can incentivize businesses to continue pursuing risky commercial strategies by reassuring them that governments will bail them out if risks are realized (a problem known as “moral hazard”).

This is essentially what happened to the U.S. soybean industry in 2018, which lost access to its largest customer due to tariff hikes by Beijing. After Washington bailed out foundering soybean exporters with a $28 billion relief package, farmers quickly resumed sales to China at pre-conflict levels, leaving them just as vulnerable to trade threats as before. As a result, when U.S.-China trade tensions escalated again in 2025, the exact same set of events played out again: China raised tariffs, U.S. exporters faced withering losses, and the U.S. government bailed them out with a $12 billion relief package. This is hardly an efficient use of taxpayer resources, chiefly because there is no guarantee such an episode will not repeat a third time.

To avoid such a scenario, policymakers should use subsidies cautiously and pair them with other measures that promote durable industry shifts. These could include mechanisms to encourage market diversification, for instance, by requiring some portion of subsidies be spent on value chain upgrading or shifts to the production base, as discussed in Recommendation 1. Bailouts could also be paired with revisions to government crop insurance programs—which usually pay out when crops fail to sell above a certain price threshold, a typical outcome of losing access to a key export market—to ensure future industry decisions are responsive to geopolitical risk. In the United States, this could be implemented by adding a diversification adjustment to reference prices in the Price Loss Coverage (PLC) and Agriculture Risk Coverage (ARC) insurance programs when a single foreign market accounts for more than a certain share (say, 50 percent) of a crop’s exports.

Policymakers should scrutinize agricultural market distortions caused by subsidies even in “normal times” when there is no geopolitical crisis. Subsidies play an outsized role in shaping the composition of agricultural industries in many countries around the world. In the United States, nearly 80 percent of insurance-premium subsidies (the most common kind of U.S. agricultural subsidy) flow to corn, soybeans, cotton, and wheat, partly because comparable insurance programs are not available for many non-commodity crops. These subsidies bear some responsibility for incentivizing a cash-crop market structure that remains highly reliant on Chinese buyers. By expanding Whole Farm Revenue Protection coverage and specialty crop insurance options, U.S. policymakers can ensure that fruit, nut, and vegetable crops are not disadvantaged relative to commodity crops’ financial profiles.

3. Develop resilience mechanisms with partners.

Mutual support agreements between strategic partners can provide some measure of coverage for countries facing coercive threats to their agricultural sectors. In several of the incidents cited in this paper, partner countries were able to defray the impacts of restrictions against a targeted country by buying up excess products and providing technical support for market diversification. These supportive measures can be implemented bilaterally but are more effective when coordinated across a larger coalition.

One idea is a pooled fund within a group of like-minded countries that can be used to purchase goods unfairly blocked from entry into China. This mechanism—sometimes dubbed a “banana fund,” in reference to Chinese restrictions on Philippine bananas in the 2010s—could counter some of the chilling effects of coercive economic threats. Smaller countries in particular stand to benefit from the diplomatic and economic cover this would provide, as they may have more difficulty self-financing such a reserve. 

A prerequisite to a banana fund or other coordinated multilateral action is timely information sharing. To deploy a coordinated response, countries must agree that not only are agricultural imports being restricted, but also that these restrictions are an attempt at coercion rather than in pursuit of legitimate trade or regulatory goals. These criteria are very hard to achieve in practice. Indeed, agricultural import restrictions are a potent form of economic coercion because they are easy to deny and difficult to attribute to high-level state policy. Economic intelligence sharing between governments can ease coordination hurdles by ensuring that concerned parties are acting on the same set of information. In practice, this is one intended role of the G7 Coordination Platform on Economic Coercion launched in 2023, but more work remains to broaden this coalition to other partners. 

A related aspect of establishing a collective response is speed. Agricultural trade flows depend on timely clearing of export and import hurdles, particularly when goods are perishable or farmers face a narrow harvesting season. As such, delays caused by cross-country deliberations can undermine the efficacy of any joint action. Policymakers can ease these delays by maintaining early warning systems and open channels of communication regarding potential disruptions of agricultural trade flows. 

Small coalitions provide useful avenues for quick responses to these challenges, but more durable change requires building consensus in larger multilateral forums such as the Group of Twenty (G20). The United States holds the G20 presidency in 2026 and is using this role to call attention to the harms of weaponized food trade. This creates a window to build consensus with other members against the use of coercive agricultural trade restrictions. These consensus-building efforts could then be translated into two concrete initiatives.

First, G20 members could adopt a “G20 Agricultural Trade Transparency Mechanism,” akin to the World Trade Organization (WTO) Trade Policy Review process. Under this framework, G20 members would be required to notify their peers of new sanitary and phytosanitary measures, antidumping probes, and licensing slowdowns when they affect bilateral agricultural trade flows above a certain threshold. This would provide a venue for countries imposing restrictions to provide evidence for their stated rationale as well as a window for peer comments. Such a mechanism would offer legitimacy to countries seeking to defend good faith restrictions and would raise the costs of illegitimate actions through broader scrutiny. Securing consensus on this process from all G20 members, including China itself, would be challenging but very worthwhile if achieved; the mechanism would still be valuable even if only a subset of G20 countries sign on. 

A G20 Agricultural Trade Transparency Mechanism could also facilitate the rapid-response offtake agreements described above. If a country brings forward a case that its agricultural exports are being unfairly restricted and the restricting country cannot provide adequate evidence that the measure was taken in good faith, other G20 members can step in to buy the blocked products. A commitment in advance to surge purchases can soften the impact of coercive threats by rapidly redirecting jeopardized trade. This is admittedly politically difficult because it may create unwanted competition with domestic producers, but in the long run such collective resilience measures may prove net beneficial to domestic industries exposed to coercive restrictions.

4. Do not copy China’s coercive playbook.

As they pursue the measures outlined above, governments should be careful not to employ coercive economic tools themselves. When countries use the same kinds of coercive techniques for which they critique China, they undermine their moral standing in the global geopolitical arena and legitimize the use of such tools by other actors.

This message needs to be heard by Washington. Under the second Trump administration, the United States has shown an alarming willingness to use coercive economic tools to pursue its own foreign policy agenda. This behavior increasingly borrows from China’s own playbook. The parallels were particularly striking in the January 2026 Greenland incident, in which Washington threatened tariffs on select European countries unless these commercial partners complied with its attempt to interfere with another government’s territorial sovereignty. The Greenland episode and subsequent flashpoints have rattled EU confidence in its longtime partner and invited accusations of U.S. hypocrisy from Beijing and other onlookers. 

Taking a principled stand against economic coercion is not just about moral posturing. When the United States uses these kinds of tools, it erodes its ability to rally partners in coordinated opposition to coercive behavior from China or other countries. Groups such as the G7 Coordination Platform on Economic Coercion and coalitions of the willing within larger forums like the WTO offer platforms for providing relief and pursuing restitution against coercive threats, but the United States’ own coercive behavior has made it politically difficult for other countries to support the use of these mechanisms against Chinese actions. This incentivizes further coercive threats from Beijing, which reckons it is less likely to be penalized for doing so by the broader international community. 

Washington’s coercive use of market access restrictions is also inflicting damage on the U.S. economy. Such actions increase the perception that the United States is a risky market, which in turn motivates exporters to diversify away from U.S. customers using the very strategies outlined in this piece. This sentiment was particularly pronounced in the wake of tariffs (since reversed by the Supreme Court) deployed under the International Emergency Economic Powers Act (IEEPA). In the agriculture industry alone, exporters in Canada, France, Greece, India, Peru, South Africa, and Vietnam (to name a few) voiced plans to shift away from U.S. markets. Should enough agricultural exporters follow through on these plans, the most likely long-run outcome is higher food prices in the United States.

This trajectory is not inevitable, but Washington will need to be diligent about reining in its unpredictable threats of market access restrictions to avoid alienating the trading partners on whom it relies. The Trump administration’s decision to exempt several agricultural products from IEEPA tariffs in November 2025, which extends to the Section 122 tariffs imposed in February 2026, is a step in the right direction. Maintaining these carve-outs on agricultural tariffs is small comfort in the face of the uncertainty surrounding USTR’s ongoing Section 301 investigations, which seek to determine whether other countries’ economic policies are “unreasonable or discriminatory” to the United States, but it might help foster a norm against using food trade restrictions as a form of retaliation in disputes that arose elsewhere. Incorporating this norm into G20 trade discussions and other multilateral forums can increase the reputational costs to China and other countries considering similar restrictions in the future. Yet none of this is credible while Washington continues to use its own coercive market tools.

Conclusion

Chinese agricultural import restrictions are a growing threat to economic security. To respond to this challenge, government and industry leaders should work together to implement a strategy for reducing risk exposure. The goal of such a strategy is not to diversify all agricultural products away from China—which would be unrealistic and unnecessary—but rather to identify sectors with particularly high-risk exposure and develop a triaged response. Depending on the specific economic dynamics of the industry in question, this could involve some combination of market diversification, value chain upgrading, and changes to the production base. None of these measures are cheap or fast, so decisionmakers should evaluate potential responses through a cost-benefit framework.

Ultimately, these decisions will need to be taken by industry actors, but policymakers have an important role to play as well. They can craft government interventions to ease market diversification costs and provide mutual support to threatened partner countries. However, governments should be careful to avoid incentivizing risky behavior through poorly designed subsidy schemes or acting in a way that legitimizes economic coercion. Well-crafted responses can promote resilient trade flows and protect countries’ ability to pursue policy goals without fear of coercive retaliation.

Please see PDF for the appendix.

Hugh Grant-Chapman is a fellow with the Economics Program and Scholl Chair in International Business at the Center for Strategic and International Studies in Washington, D.C. Moon Nguyen is a former research intern with the CSIS Economics Program and Scholl Chair in International Business at CSIS. Philip Luck is director of the Economics Program and Scholl Chair in International Business at CSIS.

This report is made possible by general support to CSIS. No direct sponsorship contributed to this report.