S everal countries have placed tariffs on U.S. agricultural and food products in 2018 to retaliate against trade actions taken by the Trump Administration earlier in the year to protect U.S. aluminum and steel producers from imports and in response to China's intellectual property rights (IPR) and technology policies. China, Canada, Mexico, the European Union (EU), and Turkey have each placed tariffs on a range of U.S. agricultural and food products in response to the decision to levy tariffs on U.S. imports of steel and aluminum. The export value of the targeted U.S. agricultural products to the retaliating countries amounted to $26.9 billion in 2017, representing 18% of the value of U.S. agricultural and food exports globally. Any loss of agricultural exports would be a concern, since about 20% of U.S. farm income stems from exports, according to the U.S. Department of Agriculture (USDA). Mexico, the EU, and Japan are forecast to rank, respectively, as the second-, third-, and fourth-leading export markets in FY2019, according to USDA. China, which is subject to the largest number of new tariffs, has countered by placing tariffs on almost all of its agricultural and food imports from the United States (see Figure 1 ). China has levied tariffs of 5%, 10%, 15%, 20%, 25%, or a combination of those amounts on more than 800 U.S. food and agricultural products that were worth about $20.6 billion in calendar year (CY) 2017. The products subject to retaliatory tariffs span all agricultural and food categories, including grains, meat and animal products, fruits and vegetables, seafood, and processed foods. As part of the agreement, China committed to immediately begin purchasing "very substantial" quantities of U.S. agricultural products, including soybeans. Canada

Canada, which ranked as the leading export market by value for U.S. agricultural and food products in 2017, has levied retaliatory tariffs of 10% on more than 20 U.S. agricultural and food products. U.S. exports of the retaliatory-tariff-affected products to Canada were valued at $2.6 billion in 2017, representing 10% of the $25.4 billion in total U.S. exports of agricultural and food products to Canada that year. U.S. exports to Mexico of agricultural and food products that are subject to tariff retaliation amounted to approximately $2.5 billion in 2017, representing 13% of total U.S. agricultural exports to Mexico of $19 billion that year. In other cases, the effects have the potential to be more significant, as the retaliating markets represent leading export markets for certain U.S. products that are subject to new tariffs. For example, in 2017 China, Canada, Mexico, the EU, and Turkey accounted for about 20% or more by value of U.S. exports of pork, soybeans, sorghum, cheese, apples, cherries, seafood, ginseng, and whiskey (see Figure 2 ). U.S. soybean exports for January through October 2018 are 63% lower than during that time period in 2017. Section 232 tariffs on steel and aluminum and an additional 25% retaliatory tariff in response to the U.S. Section 301 tariffs. U.S. frozen pork offal exports to China are now subject to a 50% retaliatory tariff, which is in addition to a preexisting tariff of 12%. Exports account for about 20% of U.S. farm income, according to USDA, so U.S. farmers and ranchers have an interest in both maintaining and expanding export markets. Several bills introduced in the 115 th Congress in both the House and the Senate would have provided more export promotion money and additional adjustment assistance to farmers affected by the retaliatory tariffs, though none passed.
Countries have imposed tariffs on U.S. agricultural products to retaliate against actions the Trump Administration took in spring 2018 to protect U.S. steel and aluminum producers and in response to Chinese intellectual property rights and technology policies. Since then, more than 800 U.S. food and agricultural products have been subject to retaliatory tariffs from China, the European Union (EU), Turkey, Canada, and Mexico. U.S. exports of those products to the retaliating countries totaled $26.9 billion in 2017, according to USDA export data. The choice of agricultural and food products for retaliatory tariffs likely reflects the large volume of agricultural trade involved and that many of these products can be sourced from non-U.S. trading partners. Such tariff hikes threaten to reduce U.S. agricultural exports.
China, which is subject to both the U.S. Section 232 steel and aluminum tariffs and separate Section 301 tariffs aimed as punishment for its handling of U.S. intellectual property rights, has placed retaliatory tariffs on the largest number and highest value of U.S. agricultural and food products. More than 800 products—including soybeans, pork, dairy products, fruits and nuts, seafood, and processed products—accounting for almost all U.S. agricultural and food exports to China in value terms in 2017 (the last full year without retaliatory tariffs) are now subject to additional tariffs of 5%, 10%, 15%, 25%, or a combination of those amounts. U.S. exports to China of those products that are subject to retaliatory tariffs were worth about $20.6 billion in 2017. China has fallen from the leading export market for U.S. agricultural products in FY2017 to the third-leading export market in FY2018 due to the retaliatory tariffs, according to the U.S. Department of Agriculture (USDA). USDA forecasts that China will fall to the fifth-leading market for those products in FY2019.
Canada and Mexico are each targeting about 20 U.S. food and agricultural products, which accounted for approximately $2.6 billion and $2.5 billion in exports to each respective country in 2017. The EU and Turkey have each put retaliatory tariffs on about 40 U.S. agricultural and food products that were valued at about $1 billion and $250 million, respectively, in 2017. India has threatened to impose tariffs on seven U.S. agricultural and food products, which accounted for about $857 million in exports in 2017. U.S. agricultural exports account for about 20% of U.S. farm income, according to USDA. Thus any loss in exports could have negative economic consequences for U.S. farmers.
Commodities that are highly dependent on exports to the retaliating markets may be more severely affected than others by any loss of markets from the tariffs. For instance, commodities for which U.S. exports to the retaliating countries represent 30% or more of its total exports include soybeans, sorghum, pork, cheese, apples, cherries, seafood, ginseng, whiskey, and some processed foods. U.S. soybean exports to China for January through October 2018 are 63% lower than during the same time period in 2017—a change due in large part to the tariffs.
USDA is attempting to ease the downside effects of the retaliatory tariffs on farmers and ranchers through a $12 billion trade aid package. Under this initiative, USDA has committed to making direct payments to farmers of selected commodities subject to the tariffs, as well as buying up surplus quantities of some commodities and providing funding for additional trade promotion efforts. In addition, legislation that was introduced in the 115th Congress sought to provide more trade assistance funding for farmers and ranchers, though none of the bills passed.