Ag Policy Blog

The U.S. Trade Representative's Office has released a report on foreign trade barriers as President Donald Trump prepares for a White House event Wednesday to detail his tariff agenda.

The 400-page 2025 National Trade Estimate Report examines import barriers by early 50 individual countries along with the 27-country European Union.

The report comes as the Trump administration is preparing to release more extensive tariff plans set to be announced Wednesday. Trump has declared his announcement as "Liberation Day" for the country's economy. The Washington Post and Wall Street Journal have reported the president could set a 20% global tariff on all imports.

Agricultural groups have been lobbying for tariff exemptions on imports -- much like the president did to lower the proposed tariff on potash from Canada. The agricultural sector also will be watching to see how markets react and whether the Trump administration is prepared to offer aid in the case of retaliatory tariffs.

The USTR report released Monday was not restricted to agriculture, but covered a range of industries, such as automobiles and pharmaceuticals, as well as restrictions on investments and emerging issues around digital assets and artificial intelligence.

The report also breaks down countries' most-favored nation tariffs, for instance, as well as specific line tariffs that USTR is raising concerns about.

For a lot of countries, the unreliability of the tariff schedule is the problem. Looking at Brazil, for example, the country has relatively high tariffs in a lot of sectors, but it is the lack of predictability that raises concerns for U.S. exporters.

Looking at agricultural issues, "dairy" is mentioned 86 times across the report as well with 24 of those dairy references focused on Canada. "Beef" also was mentioned 96 times.

CANADA

Dairy was a big subject in the USTR report when it comes to Canada. The country's supply-management programs for dairy, chicken, turkey and egg industries were pointed out. Products have tariff-rate quotas under the U.S. Mexico Canada Agreement (USMCA) for some but not all products. Once those quotas are hit, U.S. products face "prohibitively high tariffs" (245% for cheese and 298% for butter, for instance).

Then there are efforts in Canada to introduce new classes of milk that lead to further declines in imports of U.S. products.

Canada's Seeds Act also generally restricts imports of seeds not registered with the country's food inspection agency. The U.S. complains that Canada's process for import registration is slow and cumbersome and placed U.S. seed and grain exporters at a disadvantage.

CHINA

The report highlighted the 2020 Phase One Agreement and pointed out that despite agricultural exports topped $38 billion to China in 2022 that the country has fallen short of its purchase agreements and not implemented some agricultural commitments such as supporting agricultural biotechnology and conducting a risk assessment of the use of ractopamine in cattle and hogs.

"With regard to agriculture, China maintains prohibitions on the development of agricultural biotechnologies and restrictions on the development of new varieties of corn and wheat," the report cited.

China also agreed to improving the tariff-rate quotas (TQRs) for agricultural products such as wheat, corn and rice, but China still has not fully implemented those commitments, USTR stated.

More broadly, the report on China looks at some of the country's "more far-reaching and harmful industrial plants" such as its targets for strategic sectors over the next decade, which includes areas involving advanced technologies in robotics and aviation as well as "new energy vehicles." But China also wants to make advancements in farm machinery and biopharmaceuticals as well.

MEXICO

Glyphosate was a key topic with Mexico in the report as the U.S. wants Mexico to grant import permits for glyphosate and products that contain glyphosate. Mexico issued a decree in 2021 to phase out glyphosate products and the country reduced import quotas for glyphosate last July.

The report also detailed the issues with Mexico's decrees on biotech corn and cotton as well.

Mexico also has an agreement with the European Union on geographical indicators (GI) that complicates the export of U.S. products such as various cheeses.

EUROPEAN UNION

The USTR section on China was extensive, but the issues between the European Union and the U.S. over agriculture are long as well.

Europe's overall tariffs are low, but on agricultural products they can go as high as 26% while tariffs on fertilizer are around 6.5%.

There is a long list of concerns over EU import and custom procedures that the European Commission has tried to address but remain in place. Along with that are concerns about Europe's scientific review processes as well.

The EU, as part of its free-trade agreements, also requires standard certifications for a range of issues. The organizations that conduct those certifications often do not have businesses in the U.S.

The EU also has restrictions on forever chemicals, fluorinated greenhouse gases, plastic pollution, deforestation, sustainability, renewable energy and greenhouse gas emissions that concern the U.S. government as well.

When it comes to biotechnology, the U.S. is tracking 30 agricultural biotechnology product applications in the EU involving corn, soybeans, rapeseed and cotton. The USTR report cited EU's lengthy approval process for such products typically takes four years.

The EU has a renewable energy directive that includes sustainability criteria that "may limit U.S. exports of biofuels and biomass" as renewable energy sources. The U.S. exported $440 million in ethanol to EU countries in 2024 as well as $272 million in wood pellets.

Europe also has maximum residue limits for pesticides to protect pollinators that go into effect next year. The report stated the U.S. wants to work with the EU on an approach to protect pollinators but questions restrictions set on pesticides.

The EU and U.S. also cannot agree on certification requirements to allow the export of live cattle from the U.S. to Europe.

There are other concerns about Europe's "Farm to Fork" strategy to reduce agricultural inputs as well as Europe's restriction on hormone therapies for beef and the use of ractopamine.

Also, in 2026, the EU will begin a Carbon Border Adjustment Mechanism that will set reporting obligations for EU imports and require the calculations of greenhouse gas emissions. Europe will set import fees tied to carbon prices under the EU Emissions Trading System. Exporters will be able to offset those fees based on any specific carbon prices paid in their own countries. That move by the EU comes as EPA is looking to get rid of GHG reporting rules in the U.S. for major industries.

Somewhat oddly, the USTR section on the EU felt the need to highlight import licensing requirements for bananas.

INDIA

With India, the report pointed out the country's agricultural tariffs Are among the highest in the world" on a wide range of goods including vegetable oils (as high as 45%); apples and corn (50%); raisins and walnuts (100%) and alcoholic beverages (150%). There are other high tariffs on a range of processed foods as well.

India adds on top of that a list of non-tariff barriers for a range of products including livestock. The U.S. has had Word Trade Organization disputes with India over poultry products. That eventually led to an agreement that reduced tariffs on some poultry imports along with imports of products such as blueberries and cranberries.

India also has restrictions on imports of ethanol for fuel use despite aggressive targets for blending ethanol with gasoline.

Coupled with all of that, India also provides a range of subsidies for its agricultural sector, including subsidies for inputs. The country has a minimum price support program for at least 25 agricultural commodities.

For most countries there was also some level of sanitary and phytosanitary barriers on products, whether that is pest-mitigation practices for potatoes in Egypt; biotechnology restrictions across a range of countries; or Taiwan's barriers to U.S. beef products going back to bovine spongiform encephalopathy (BSE).

The full report can be found at https://ustr.gov/…

Also see, "Rollins Touts Biofuel Policies to Boost Corn Demand as USDA Preps for Trade War," https://www.dtnpf.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on social platform X @ChrisClaytonDTN

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