USMCA Renewal Battle Sparks Economic Anxiety Across Rural America
Farm groups warn that uncertainty over USMCA could threaten exports, farm income and food affordability as the agreement faces a crucial review.
Agricultural organizations, exporters and business leaders testified before Congress on June 10, 2026, urging policymakers to approve a full 16-year renewal of the U.S.-Mexico-Canada Agreement (USMCA) ahead of a formal review beginning July 1. The push comes after President Donald Trump questioned the need for the trade pact, a development that matters because Canada and Mexico are America's two largest agricultural export markets and play a critical role in farm income, commodity prices and rural economic stability.
A coalition of farm and agribusiness organizations is warning that uncertainty surrounding the future of USMCA could create significant challenges for producers already facing tight margins, high input costs and volatile commodity markets.
The agreement, negotiated during Trump's first term and enacted in 2020, is scheduled for its first mandatory review six years after implementation. While many agricultural groups are calling for an immediate 16-year extension, concerns are growing that the process could instead lead to annual negotiations and prolonged uncertainty.
Several industry organizations have joined the newly formed Agricultural Coalition for USMCA, arguing that stability in North American trade is essential for the long-term health of the farm economy.
Trade Growth Has Fueled Agricultural Exports
The numbers illustrate why farm groups are aggressively defending the agreement. Since USMCA took effect, the value of U.S. agricultural exports to Canada and Mexico has increased by 47%, far outpacing the 18% growth recorded in exports to the rest of the world.
Today, Canada and Mexico remain the two largest foreign buyers of American agricultural products, helping offset weaker demand from other key markets, including China. In 2025 alone:
- U.S. agricultural exports to Mexico totaled $30.6 billion.
- U.S. agricultural exports to Canada reached $28.2 billion.
- Combined trade with the two countries represented one of the most important revenue streams for American agriculture.
Despite strong exports, the United States continues to run an agricultural trade deficit with both neighbors, importing $44 billion in agricultural products from Mexico and $39.3 billion from Canada last year.
Industry leaders told lawmakers that many agricultural sectors have become deeply integrated with Canadian and Mexican markets. Michael Lichte of Dairy Farmers of America noted that 40% of U.S. dairy export value depends on Canada and Mexico, with Mexico serving as the industry's largest export destination.
The American Soybean Association also emphasized the agreement's importance. Minnesota farmer Jamie Beyer said Canada and Mexico account for roughly $4 billion in soybean-related exports, representing more than 13% of total soy complex shipments.
The Meat Institute highlighted equally significant benefits for livestock producers. According to the organization, trade under USMCA generates approximately $91 per head for cattle producers and $28 per head for pork producers, providing a meaningful boost to farm profitability.
While most witnesses strongly supported renewing the agreement, some sectors argued that USMCA should be strengthened and modernized.
David Puglia, president of the Western Growers Association, said Canada and Mexico purchase roughly two-thirds of all U.S. fresh produce exports, making continued access to those markets essential.
At the same time, growers expressed concerns over increasing competition from Mexican fruit and vegetable imports and called for stronger enforcement of food safety standards and fair trade rules.
Several lawmakers also raised concerns about specialty crop producers who believe Mexican products are entering the U.S. market at unfairly low prices.
Still, industry leaders broadly agreed that abandoning USMCA would create more economic damage than maintaining and improving it.
Beyond agriculture, economists and business groups argue that USMCA directly affects American households. A recent Purdue University study found that the agreement saves U.S. consumers approximately $700 annually in food costs, largely because of lower tariffs and more efficient supply chains.
The study concluded that without USMCA, tariffs on food products could increase by an average of 7.4%, potentially reversing those savings and adding pressure to already elevated grocery bills.
Business leaders warned that the loss of duty-free trade would likely increase costs throughout the agricultural supply chain, from farm inputs to retail food products.
Farmers Warn Against Walking Away
The strongest warning came from producers themselves. Iowa farmer Bob Hemesath argued that ending or weakening USMCA would amount to a "self-inflicted wound" for American agriculture.
He highlighted one often-overlooked reality: the United States imports roughly 90% of its potash fertilizer, and more than 80% of those imports come from Canada. Without reliable access to Canadian fertilizer supplies, farmers could face higher production costs and lower yields.
For producers already grappling with elevated input costs, uncertain commodity prices and weather-related risks, many see USMCA as one of the few sources of stability in an increasingly unpredictable global marketplace.
As the July 1 review approaches, the debate over USMCA is evolving into more than a trade discussion. For many agricultural leaders, it represents a choice between maintaining integrated North American supply chains or introducing uncertainty into markets that support billions of dollars in farm exports.
The outcome could influence everything from crop prices and livestock returns to food affordability and rural economic growth, making the upcoming review one of the most closely watched agricultural policy events of 2026.
