U.S. Agriculture Faces Crisis: Tariffs Lead to Canceled Orders, Layoffs, and Reduced Chinese Purchases

The U.S. agricultural sector faces a crisis due to escalating tariffs, leading to canceled export orders, layoffs, and reduced Chinese purchases. The Agriculture Transportation Coalition highlights significant financial losses as China shifts to suppliers like Brazil. The USDA reports a major cancellation of U.S. pork shipments to China. The crisis affects rural economies, with layoffs and unsold inventory. The Port of Oakland, reliant on exports, is also impacted. U.S. farmers and exporters are urging policy reversals to mitigate the trade war's effects, as China continues to diversify its agricultural imports.

Tariffs Trigger Export Cancellations and Financial Losses

The Agriculture Transportation Coalition (AgTC), a leading trade group for U.S. agricultural exporters, has sounded the alarm, declaring the situation a "full-blown crisis." Executive Director Peter Friedmann told CNBC that the number of canceled purchases should not be seen as a warning sign but as evidence that the crisis is already underway.

Data from the U.S. Department of Agriculture (USDA) revealed that China recently canceled 12,000 metric tons of U.S. pork shipments—the largest cancellation since 2020. This move follows a broader trend of declining Chinese purchases of U.S. agricultural products, including soybeans, corn, and sorghum.

Exporters across various sectors are reporting immediate and severe impacts. A wood pulp and paperboard exporter reported the cancellation or hold of 6,400 metric tons of goods in warehouses and 15 railcars stuck in demurrage. Another 9,000 metric tons en route to China now face the risk of costly diversions or abandonment at Chinese ports.

Similarly, a grass seed exporter received just two weeks' notice that eight loads were canceled by Chinese customers, despite vessel bookings already being in place. These abrupt cancellations are creating logistical nightmares and financial strain across the supply chain.

Layoffs and Economic Fallout in Rural America

The crisis is not confined to canceled orders. It is also manifesting in widespread layoffs and economic distress in rural communities. A hay exporter in Central Washington, heavily reliant on exports to Hong Kong and mainland China, reported that it had to lay off 12 employees—one-fourth of its workforce—after being forced to reroute shipments to less profitable markets like Japan, Dubai, and Taiwan.

The exporter described the situation as "unsustainable," emphasizing that no other market can absorb the volume of goods that China once purchased. The company has halted all orders in process and warned that the financial strain is jeopardizing its future operations.

Other exporters, such as those dealing in lumber and forage, have also reported diverting employees and production to less profitable activities, slowing down purchases from independent vendors like loggers, truckers, and sawmills. Some products have already seen a 20% decline in market value, further eroding profitability and investment capacity.

Port Operations and Regional Economies Under Threat

The Port of Oakland, a critical hub for U.S. agricultural exports, is feeling the pressure as well. Executive Director Kristi McKenney warned that a tariff-induced downturn in cargo volume could jeopardize job stability and the region’s economic health. Unlike many U.S. ports that primarily handle imports, Oakland maintains a near 50/50 balance between imports and exports, making it particularly vulnerable to retaliatory tariffs.

Exports such as almonds, beef, pork, dairy, and recycled materials—much of which are destined for Asia—are at risk. China, which accounts for 29% of Oakland’s total trade volume, is the port’s top import trading partner and third-largest export partner. A decline in trade with China could significantly erode California’s market share for perishable and high-value commodities.

Congresswoman Lateefah Simon emphasized the stakes, stating, "So many local, union jobs depend on the Port's robust shipping operations including dockworkers, truck operators, and warehouse workers."

China's Shift to Alternative Suppliers

China’s strategic pivot away from U.S. agricultural products has compounded the crisis. According to reports from Agriculture.com, China has increasingly sourced grains and oilseeds from Brazil and other countries, citing sufficient global supplies to replace U.S. imports. Zhao Chenxin, deputy director of China’s National Development and Reform Commission, stated that even without U.S. feed grains and oilseeds, China’s grain supply would remain unaffected.

World-Grain reported that China has not placed an order for U.S. corn and soybeans since January 16, 2025, further highlighting the deepening rift. The U.S. has also lost its position as China’s top soybean supplier, with Brazil now dominating the market.

The shift is not limited to grains. China recently canceled a significant pork shipment and has diversified its sources for other agricultural commodities, leaving U.S. farmers scrambling to find alternative buyers.

Broader Trade and Shipping Challenges

The crisis is exacerbated by broader trade and shipping challenges. The recently announced SHIPS Act measures, which impose port fees of up to $1.5 million on Chinese-made vessels calling at U.S. ports, threaten to further disrupt agricultural exports. Although bulk agriculture shipments are exempt, containerized agriculture—which includes high-value products like refrigerated beef, pork, poultry, fruits, vegetables, and processed foods—is not.

Peter Friedmann of AgTC stressed the urgency of securing an exemption for containerized agriculture, noting that approximately 25% of U.S. agricultural exports by volume and nearly 55% by value are shipped in containers.

Meanwhile, vessel traffic between China and the U.S. has plummeted. According to Vizion Global Ocean Bookings Tracker, China-to-U.S. vessel traffic dropped 22.15% week-over-week and 44% year-over-year through April 14, 2025. Ben Tracy, vice president of strategic business development at Vizion, confirmed that booking demand for U.S. imports from China continues to decline, translating into fewer departures and further straining supply chains.

Farmers' Plea for Policy Reversal

Facing mounting losses, canceled orders, and layoffs, U.S. farmers and exporters are pleading for a reversal of the current trade policies. A hay exporter captured the sentiment in a letter to AgTC, writing, "So much of our future lies in the hands of so few. We plead for those few to take a very long careful look at what can be done to keep shipments flowing while they work out the trade imbalances and perceived differences."

The agricultural sector, once a pillar of U.S. exports, now finds itself at the epicenter of a trade war that shows no signs of abating. Without swift and targeted policy interventions, the damage to rural economies and the broader agricultural industry could deepen further.

References

• Trump tariffs live updates: Bessent says it's 'up to China' to deescalate trade tensions
• China shrugs off threat of US tariffs to economy, says it has tools to protect jobs
• China Says It Won’t Be Affected by Loss of U.S. Grains and Oilseeds
• Agriculture isn't nearing trade war tariffs crisis, 'it is full blown crisis already' farmers say
• Trade Tensions and Weather Woes: Soybeans, Corn, and Wheat Face Volatile Markets