With President Donald Trump threatening tariffs on both Mexico and Canada, there are big implications on South Dakota’s agricultural economy.
Mexico and Canada have both threatened to impose their own tariffs on U.S. products including beef and pork.
Although the tariffs have been pushed off for a month, they loom large over the South Dakota farming community.
The state’s top agriculture and agri-food export markets are Canada and Mexico, making up over 75% of those exports.
Some farmers said this wouldn’t be the first time Trump’s tariffs have hurt South Dakota’s ag sector. In 2018 China put tariffs on the US soybean markets in response to Trump’s tariffs on the country.
Doug Sombke is the president of the South Dakota Farmer’s Union. He said there isn’t a lot of optimism around the prospect.
“This is not a good deal, either one. And they’re allies of ours on top of it. This is not good for South Dakota farmers and ranchers. It’s gonna cost us more from the aspect of parts for our machinery for our equipment and also any other imports like fertilizer and fuel," Sombke said. "And on the other side, Canada and Mexico are going to impose tariffs on us and exports that we still do sell them. I mean this is just not a good deal for agriculture in any shape of the imagination. "
Sombke said the only thing that kept the industry afloat during 2018 was federal government payments handed out to offset the losses from the tariff war. He said that only furthered the federal spending deficit.
Scott VanderWal is the president of the South Dakota Farm Bureau. He has a little more hope based on the circumstances.
“It creates jitters in the market, and especially for ag commodity markets because that’s where the retaliatory tariffs can show up. And I understand the president got both Mexico and Canada to agree to put 10,000 troops on the borders in an effort to clean up the drug problems that are coming across the border, which is good, that’s good," VanderWal said. "We just urge him to keep in mind that there are possible negative effects of things like that. Sometimes, you like to keep tariffs in your back pocket for a last resort.”
VanderWal said in the current economic market for the ag industry, an international tariff war could cause the industry to “drown in it.”
