Shutdown Threatens Farm Aid Rollout Amid Tariff Tensions
Tariff aid for U.S. farmers is on hold as the government shutdown stalls USDA operations and delays a major relief package.
The planned tariff assistance package for U.S. farmers-expected to be announced next week-faces major delays as the federal government shutdown furloughs nearly half of USDA employees. The administration had aimed to unveil the plan Tuesday, but lawmakers now say that timeline is in doubt.
Sen. John Hoeven, R-N.D., ranking member on Senate Ag Appropriations, told reporters Friday that the timeline for aid "could change now with the shutdown." Treasury Secretary Scott Bessent said Thursday the administration hoped to finalize details by early next week, but sources familiar with the talks say it's unlikely without key USDA personnel available to assemble the package.
The Trump administration wants to revive tariff-based farm aid, using tools like the Commodity Credit Corporation (CCC) and potentially reworking Section 32 to channel tariff revenues into producer payments. But with the CCC's borrowing authority reduced-now estimated around $4 billion out of $30 billion-and additional draws on the fund expected soon, USDA has little room to maneuver.
During Trump's first term, more than $20 billion in tariff compensation was delivered to farmers. Now, analysts believe the financial need may be even greater, with USDA projecting ag sales to China could fall below FY2019 levels-the lowest point during the previous trade war.
Still, Hoeven declined to say how large this new assistance package might be. "The administration will tell you that," he said. What is clear is that congressional and administration staff are working urgently behind the scenes to define the package's scope, which could involve multiple funding mechanisms.
There's also a looming legal risk: the Supreme Court is set to hear a case in November challenging the legality of many Trump-era tariffs. A ruling against the tariffs could force refunds, undermining any Section 32-based aid plan that relies on that revenue stream.
Sen. Roger Marshall , R-Kan., expressed cautious optimism that more commodities will be included in the relief. "I think the sorghum guys are hurting a lot more, proportionally, than the soybean guys," he said, noting how soybeans have received the most attention due to their deep export ties to China.
Lawmakers are also exploring legislative tweaks to ensure USDA retains multiple aid channels, even amid funding constraints. "We've got that tool [CCC] available for them, and we're working on some others too," Hoeven emphasized.
For now, producers wait-caught between trade headwinds and government gridlock, with another critical harvest season in the balance.