US President Donald Trump announced a $12 billion aid package for farmers, providing financial support to a core part of his political base that has been hit hard by falling crop prices and trade policy.
President Trump announced the plan Monday at the White House in Washington, D.C., along with Secretary of Agriculture Brooke Rollins and several farmers, saying, “Maximizing domestic farm production is a critical part of how we make America affordable again and lower food prices.”
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Rollins said the initial phase of the Farmer Bridge Assistance Program will provide $11 billion to row crop farmers who grow crops such as corn, soybeans and cotton in rows. An additional $1 billion has been allocated to farmers who grow some specialty crops that are not eligible. The support money is expected to arrive by the end of February.
The policy is the latest effort by President Trump to protect his economic record and respond to public concerns about rising food prices. It also comes after China restricted purchases of U.S. soybeans in retaliation for high U.S. trade tariffs that caused prices for fertilizer and other agricultural products to soar.
How will this aid be distributed to farmers?
The United States Department of Agriculture (USDA) uses formulas to estimate production costs to calculate how much you should pay per acre for various crops. Payments are capped at $155,000 per farm or individual, and only farms with annual income of less than $900,000 qualify.
USDA’s program is intended to help small producers, who may have more hardship than other producers. “We looked at how they were hurt and how much they were hurt,” Trump said.
Farmers will begin receiving funds on February 28, Rollins said. Meanwhile, applications for funding will open in the coming weeks so farmers “will know exactly what the numbers are.”
President Trump said the plan would be funded by tariff revenue.
President Trump has at times downplayed the cost of living issue, but on Tuesday he visited Pennsylvania to explain to voters how his administration is addressing this concern.
At the same time, he defended his record on trade and the extensive reciprocal tariffs he imposed on countries around the world this year. President Trump called the tariffs “astonishing” at a rally in Mount Pocono, Pennsylvania. “It’s the smart people who are figuring it out. Others are starting to learn it, but the really smart people are figuring it out.”
Why is this support measure being introduced now?
Many farmers continue to support Trump. The nation’s most agriculturally dependent counties overwhelmingly supported him in last year’s presidential election by an average of 77.7%, according to the Department of Agriculture.
Experts say his anti-establishment rhetoric resonates with rural communities who feel ignored by political elites in Washington, D.C. His promise of deregulation also appealed to many farmers who feel burdened by federal rules.
But the president’s trade policies and the imposition of trade tariffs to address trade deficits with many other countries are hitting farmers hard. President Trump’s “Emancipation Day” tariff announcements earlier this year led to costly retaliatory tariffs on U.S. goods, including U.S. agricultural exports, especially those from China.
President Trump’s latest policy mirrors a $12 billion program he offered farmers in 2018 during a trade dispute with China early in his first term.
Which crops have been hit hardest by trade tariffs?
Soybean farmers have been hit hard this year by the U.S.-China trade war. President Trump has been the chief architect of recent tensions, and his sweeping “reciprocal” tariffs, imposed earlier this year, targeted China more than any other country.
Historically, more than half of the soybeans produced in the United States (mainly in the Midwest) have been sold to China. However, after President Trump imposed steep tariffs on Chinese products, the Chinese government increased tariffs on U.S. soybeans to 34%.
Last year, China bought more than 50% (27 million tons) of the $24.5 billion in agricultural products sold to international markets by U.S. soybean farmers. U.S. exports to China have fallen by more than half so far this year.
Instead, China began buying more soybeans from Brazil and other South American countries.
The U.S. Soybean Association also warned that the tariffs are increasing costs for soybean producers. In particular, US tariffs on Moroccan-produced fertilizers have been raised from 2.1% to 16.8%, putting pressure on farmers.
In October, after a meeting with Chinese President Xi Jinping in South Korea, President Trump said Beijing had committed to purchasing 12 million tons of U.S. soybeans by the end of this year and 25 million tons annually for the next three years.
President Trump is also facing pressure to address rising beef prices. On Nov. 7, he asked the Justice Department to investigate foreign meat processors in the U.S. that he claims are driving up costs, but he has provided no evidence to support this claim.
Then, on November 20, President Trump announced that he would eliminate trade tariffs of up to 50% on some Brazilian agricultural products, including coffee and beef. The reversal was widely interpreted as an admission that tariffs were accelerating domestic inflationary pressures.
More broadly, U.S. consumer sentiment remains near record lows. Data released by the University of Michigan in November revealed that Americans believe their personal finances are at their weakest since 2009. High inflation is a major cause for concern.
Prices of other staple foods have also increased recently. Compared to Thanksgiving last year, potatoes rose 3.7%, bread rolls 3.9% and apples 5.3% this November, all of which were above the annual inflation rate of 3%, government data showed.
Will President Trump’s relief package be enough to save farmers?
Farmers generally welcome President Trump’s relief package, but many see it as a temporary reprieve rather than a solution to long-term issues such as rising costs and the decline of small-scale farming.
“(This is) a start, but I think we need to look for avenues to find other funding opportunities, and we need to get the market moving. That’s where we want to make a living,” Kentucky farmer Caleb Ragland told The Associated Press on Monday.
Family farms and those who rent land are especially exposed to President Trump’s trade war. Many small farms are already operating on thin margins and are struggling to absorb the shock of rising input costs.
As tensions continue, analysts warn that the sector could become further consolidated, with large industrial farms expanding their operations while small-scale producers disappear or take on more debt to survive.
Earlier this year, Cornell University in Ithaca, New York, estimated that farm bankruptcies rose 60% in the first half of this year compared to a year earlier. Additionally, agricultural sector debt is expected to increase by 5% to nearly $600 billion in 2025.
Libby Schneider, deputy executive director of the Democratic National Committee, said in a statement that President Trump’s aid package is not enough. “Farmers don’t want handouts, they want markets to recover,” she said in a statement.
