This week was busy for Minnesota Farmers Union’s policy team and consequential for family farmers across the state. President Trump’s tariffs on Canada and Mexico went into effect on March 4, with both countries quick to respond, and state senators passed a first—if small—agriculture bill off the Senate floor with broad bipartisan support. As always, we’re working to ensure that policymakers on all levels of government understand and are responsive to the needs and perspectives of Farmers Union members.

On March 4 and on the eve of his joint address to Congress, President Trump started a trade war, hiking tariffs on imports from Mexico, Canada, and China, the United States’ three biggest trading partners. At midnight on March 4, 25 percent tariffs—essentially taxes on imports—went into effect for Mexico and Canada, with the exception of Canadian energy which was limited to 10 percent. For China, the existing tariff was doubled from 10 to 20 percent.

As expected, these countries were quick to respond with retaliatory tariffs on exports, and agriculture was hit hard. This includes a 10 to 15 percent tariff on meat and soybeans China purchases from the United States.

For months, Minnesota Farmers Union has worked to draw attention to the harm a renewed trade war would to family farmers and our rural communities. In October, MFU President Gary Wertish led a national press conference with agriculture leaders from Minnesota and across the country imploring a future administration to take a balanced approach to trade. In November, delegates to State Convention passed a Special Order of Business on fair markets, making opposition to tariffs a priority going into 2024

“Whereas a trade war could prove devastating for farmers and our rural economy, particularly when farmers are already facing steep input costs and thinning margins,” reads the Special Order approved by delegates to MFU’s State Convention in November. “Be it resolved that Minnesota Farmers Union strongly opposes tariffs that negatively affect family farms and rural communities. We call on the incoming administration to work towards commonsense international trade agreements that honor existing relationships and provide stability for farmers and the agricultural economy.”

Building on this, last month, MFU hosted Sen. Klobuchar to highlight the damage proposed across-the-board tariffs would do if they went into effect.

And this week, President Wertish joined Sen. Klobuchar as her guest to the President’s joint address to Congress, in large part to emphasize the financial harm of tariffs.

“Gary represents so many family farmers and other Minnesotans who are worried about making ends meet because of the Administration’s proposed tariffs, funding freezes, and mass layoffs,” said Sen. Klobuchar. “He will be a voice for all Minnesota farmers at the President’s Joint Address.”

Wertish pointed out that farmers are “watching Washington and wondering what a potential trade war, layoffs at local USDA offices, and proposed cuts to Farm Bill programs are going to mean for their farms and communities. This only adds to uncertainty and challenges going into spring planting.”

In remarks during that visit, Gary pointed out how tariffs hurt farmers both in terms of sales and inputs. “We know [tariffs] will raise fertilizer costs by as much as $1.70 an acre for corn and $1.42 an acre for soybeans.”

President Trump cited trade deficits with Canada and Mexico along with fentanyl as reasons for the tariffs. On the Social Media site Truth Social he told farmers to focus on domestic sales.

“Get ready to start making a lot of agricultural product to be sold INSIDE of the United States. Tariffs will go on external product on April 2nd,” President Trump wrote. “Have fun!”

Also on March 4 and in response to tariffs, Minnesota Gov. Tim Walz and Agriculture Commissioner Thom Petersen joined MFU Goodhue County President Danny Lundell and Mary Lundell on their farm for a press conference.  

 In remarks, Danny pointed out how this creates “uncertainty and chaos” for farmers.

Commissioner Petersen talked about the impact a renewed trade war—along with layoffs at USDA—could put pressure on an already-depressed farm economy. Farmer-lender mediations, he shared were seven times higher this January than in 2024, he said in his remarks.

MFU has long championed Minnesota’s nation-leading Mandatory Farmer-Lender Mediation program, which provides farmers the opportunity to renegotiate, restructure, or resolve a farm debt during a 90-day period when lenders are prohibited from enforcing that debt. The help is confidential and supported by state and federal dollars.

On the state level, the big news this week is yet to come. Budget officials are set to release an updated economic forecast on Thursday at noon. While these new numbers are expected to be tighter than in November, they won’t incorporate impacts of potential cuts by Congress, mass layoffs of federal workers, Medicaid cuts or other federal actions, which we wrote about in the last e-news update.

The estimate also won’t include the economic impact of the newly launched trade war, which has already plunged the stock market and could result in business contraction and fewer purchases on the part of consumers. All of this results in less tax revenue for the state.

While anticipating an updated budget forecast, state lawmakers have continued to move forward—including on some MFU priorities that don’t new cost money.

In the House, Agriculture Chair Paul Anderson, R-Starbuck, led a bill (HF770) MFU helped advance to provide $30 million in additional bonding authority to Minnesota’s Rural Finance Authority (RFA). MFU member Matt Hardy of Rust Hill Ranch testified to his own experience buying his farm with the help of the RFA’s Beginning Famer Loan Program, their most popular loan.  

“Not only did this program help me get started, it’s continued to save me money and allowed me to reinvest in my operation,” he shared with the committee. “The lower interest rate I was able to lock in with the help of the Rural Finance Authority saves me enough interest expense each month, for example, to purchase one ton of hog feed.”

“The low-interest loans made available by the RFA help young farmers, farm families rebuilding after natural disasters, and others reinvesting in their operations,” wrote MFU President Wertish in a letter to committee members in support of this bill. “Top of mind right now is uncertainty in both the farm economy and at the federal level, meaning more farmers may lean on this state program for affordable financing.”

Wertish and MFU Executive Committee Chair Carol Anderson both serve on the Rural Finance Authority board. The bill passed on a voice vote and was referred to the Committee on Capital Investment.

Finally, a first agriculture bill—and one MFU worked hard on—was passed out of the Senate and on the House on a broad bipartisan vote (66-0) last Thursday. The bill (SF1552), led by Sen. Rob Kupec, DFL-Moorhead, would ease reporting requirements on small grain buyers including independent elevators, feed mills and farmer co-ops. Importantly it does this without compromising MDA’s ability to evaluate their financial position in order to protect farmers.  

In the House, Chair Paul Anderson, R-Starbuck, who leads the bill in that body, took the opportunity to refer the Senate-passed version for comparison with his House bill—the first step in passing it out of that body. Lawmakers are acting quickly given that regulations could cause some small grain buyers to face financial hardship or even close. And passing the bill soon would ensure the state can implement the change before reports are due.

As always, this is just a snapshot of our policy work. If you have questions, thoughts, or concerns, reach out to Stu at (320) 232-3047 (C) or stu@mfu.org.