How Might the Trump-Xi Summit Impact U.S. Farmers?

First, per the White House read-out of the agreement, China pledged to purchase 12 million metric tons (MMT) of U.S. soybeans in November and December 2025. U.S. soybean exports to China in the first 10 months of 2025 reached just 6.5 MMT, much less than in prior years. The additional soybean purchase commitments, if met, would still have fallen short of closing the gap to the historical average of 29 MMT of soybean exports to China per year—but they would have helped.

Unfortunately, by the time the two presidents met in Busan, the United States had already passed its peak soybean harvest season, and China had replaced most lost U.S. imports with Brazilian soybeans. U.S. Trade Representative Jamieson Greer belatedly conceded these hurdles in December 2025 when he announced the deadline would be relaxed to the end of the “growing season.” Then, in late January 2026, soybean traders reported that Chinese buyers had reached the 12 MMT purchasing commitment, with plans to ship the purchased beans between December 2025 and May 2026. Interestingly, as of April 30, 2026, these purchases are still not fully reflected in U.S. Department of Agriculture (USDA) data, which reports 11.8 MMT in total purchases and 10.6 MMT of actual exports during the period in question. One can debate whether or not these developments satisfy the letter or the spirit of the Busan agreement, but the bottom line is that they were far from sufficient to reverse lost soybean exports earlier in the trade conflict. U.S. soybean exports to China totaled $3.1 billion in all of 2025—a stunning $9.6 billion drop compared to exports in 2024.

Beyond the initial 12 MMT soybean purchase commitment in 2025, China also pledged to buy 25 MMT in 2026, and again in 2027 and 2028. The 12 MMT purchase deadline’s slide into 2026 creates some confusion about how exactly these subsequent commitments will be accounted, but in any case, the bulk of the pledged purchases will likely occur in the summer or fall. Farmers have noted with frustration that these commitments are lower than purchases in recent years. Even still, Chinese importers face headwinds in meeting these commitments, namely because U.S. soybeans have grown more expensive than their alternatives—as discussed below.

In addition to the soybean purchase commitment, Beijing also agreed to lift retaliatory tariffs levied on U.S. agriculture and other imports in March 2025. The exact verbiage of this commitment differs slightly between the version of the agreement published by the White House and the subsequent document released by the State Council of China. The White House publication states that “China will suspend all of the retaliatory tariffs that it has announced since March 4, 2025” (emphasis added). The State Council announcement, by contrast, orders the removal of tariffs imposed “on” March 4 (outlined here), but does not refer to any tariffs imposed after that date. The upshot of this is that an additional 10 percent tariff on U.S. goods—a residual from a separate U.S.-China agreement struck in May 2025—was left in place. This 10 percent tariff remains in force on U.S. agriculture imports on top of most-favored nation rates, undermining U.S. farmers’ competitiveness.

The other measure included in the Busan agreement was an extension of China’s “market-based tariff exclusion process” for imports from the United States. This process allows Chinese importers to apply for waivers on tariffs on select U.S. imports. Anecdotally, this exclusion process appears to still be in place, as reported by the USDA Foreign Agricultural Service in November 2025 and several subsequent reports.

Last, the Busan agreement indicated that China would resume buying U.S. sorghum as well as hardwood and softwood logs, which it has indeed done. Since the agreement was struck, China imported $512 million worth of U.S. sorghum and $150 worth of U.S. logs.

Broader Trends in U.S.-China Agricultural Relations

The Busan agreement aimed to diffuse short-term irritants to U.S.-China agricultural relations, but deeper, structural headwinds were left unaddressed. Total U.S. agricultural exports to China in 2025 fell by 62.7 percent year-over-year, a nominal $15.9 billion contraction. Though this can partly be attributed to trade war turbulence, it is worth noting that U.S. agricultural exports to China shrank every year before that since 2022. Moreover, in each of these years, U.S. agricultural exports to China shrank faster than total U.S. exports to China, suggesting that the agriculture sector is disproportionately influenced by trends toward decoupling.

What explains these shrinking trade flows? Part of the answer lies in President Xi’s food security policy, which increasingly emphasizes self-sufficiency as a strategic national priority. Throughout the 2010s, China ran a steadily widening deficit in food trade and agricultural trade more broadly. But this deficit began to stabilize in 2022, and by 2024, it was actively shrinking thanks to a host of policies stimulating domestic production. Moreover, China’s central and regional governments are not immune to the age-old phenomenon of domestic agricultural industries pressing for protectionist measures. Chinese agricultural producers have successfully lobbied for trade restrictions several times in recent years, often by linking them to Beijing’s food self-sufficiency push or other strategic goals. Even when not explicitly linked to protectionist policies, surges in domestic food production can lead to unexpected knock-on effects for trade partners—such as the slowdown in U.S. corn purchases spurred by an excess supply of Chinese pork.

In agricultural industries where China remains import-dependent, Beijing has sought to reduce reliance on the United States in particular. Chinese leaders increasingly view Washington as a dangerous and erratic trading partner, and deteriorating U.S.-China relations have led to concerns that agricultural trade dependencies could be weaponized for political ends. (This rationale, of course, is an ironic mirror of Washington’s own efforts to reduce trade dependencies.) As a result of these efforts, U.S. products fill a shrinking share of China’s basket of agricultural imports. Brazil claimed the largest share of the ceded market from 2021 through 2023, but the biggest winners of the shift in 2025 were actually Vietnam and Indonesia—a trend which has received relatively little discussion in Washington.

The drivers of the shrinking U.S. agriculture market share are economic just as much as they are political. In recent years, U.S. soybean exporters have lost some of the price advantages that boosted competitiveness in global markets. Surging production in Brazil and Argentina has pushed prices down, while U.S. growers have suffered from rising input costs. That said, this effect is not uniform. Wheat price differentials have held relatively steady in recent years, and corn price differentials have even grown more favorable toward U.S. growers.

This loss of competitiveness is not inevitable. Yet reversing it will require thoughtful policy that dispels the perception of geopolitical risk around U.S. supply chains and addresses structural costs that push up U.S. producers’ prices. These are explored in turn below.

U.S. Farmers Face Compounding Pressures

Slowing trade with China comes at a time when U.S. farmers face severe financial strain from other sources. The U.S. military offensive against Iran and the subsequent closure of the Strait of Hormuz have disrupted crucial supply chains for fertilizer feedstocks, causing the prices of some fertilizers (namely, urea) to rise by over 50 percent in the two months since the conflict broke out. This comes after U.S. tariff hikes sent fertilizer prices climbing throughout 2025. According to research by North Dakota State University, the added 8 percent tariff on diammonium phosphate (DAP), a widely used fertilizer, led wholesale prices to increase by up to 27 percent (a 342 percent pass-through rate). Given the razor-thin operating margins of the U.S. agriculture sector, many farmers have no choice but to pass these costs onto consumers. Tariff refunds in the wake of the Supreme Court’s International Emergency Economic Powers Act ruling may offset these costs, but the process for obtaining these refunds is in its early stages and has run into technical challenges and eligibility confusion.

Rising fertilizer costs are not the only thing squeezing U.S. farmers. The closure of the Strait of Hormuz has caused diesel fuel prices to skyrocket, breaking records of $6 per gallon in some parts of the country. Diesel is a crucial input for many agricultural industries, fueling the equipment needed to till, plant, and harvest crops—equipment which itself has become more expensive due to tariffs. Together, these price hikes are pushing farmers’ balance sheets into the red.

A third threat confronting U.S. agriculture is extreme weather. In the first four months of 2026, farmers have confronted record-setting drought—which currently covers over 60 percent of the continental United States—as well as extreme heat in some regions and late freezes in others. These phenomena are a painful illustration of how climate change is disrupting global food systems and threatening farmers’ livelihoods. In some U.S. agricultural communities, farmers have begun appealing to state and local governments for emergency relief, and more may follow as the climate crisis deepens.

These challenges collectively make up an acute threat to many agricultural businesses in the United States. In 2025, even before the consequences of the Strait of Hormuz disruptions, the number of farm bankruptcy filings climbed 46 percent relative to the prior year. Farm sector debt continues to rise, as farmers tap credit to weather financial turbulence. Net farm income in 2026 is projected to fall by 0.7 percent ($1.2 billion) year-over-year in 2026. This estimate is still up a full $25.8 billion from 2024 income levels, though this is more a consequence of more federal government direct farm program payments (projected to increase by $34.2 billion) than any significant growth in agricultural product sales.

Conclusion

With this grim situation in the backdrop, the U.S. agriculture sector is closely watching the outcome of President Trump’s meeting with President Xi in Beijing. The lesson of the Busan agreement and its impacts, however, is that any agricultural concessions between the two leaders are at best likely to be a band-aid on deeper structural issues. Unless Beijing is willing to push against the current of prevailing market and policy incentives (unlikely)—or unless those incentives change significantly—the U.S. agricultural industry will play a shrinking role in China’s consumer market. The sooner that U.S. producers come to terms with this reality, the quicker they will be able to identify other opportunities and chart a sustainable path forward to growth.

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.