America’s Farmers Renew Trump Support Despite Trade War Fears

Ilena Peng, Tarso Veloso and Kim Chipman
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(Bloomberg) -- If American farmers have their way, Donald Trump will be president again. That’s despite concerns he could restart a trade war with China, the world’s largest buyer of US agricultural products.

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Growers helped propel Trump to the 2024 Republican nomination in Iowa, with the former president beating rivals Ron DeSantis and Nikki Haley by a wide margin. The victory in a state where agriculture is king showed farmer support remains strong even in the face of trade disputes that could end up hurting their incomes.

“Every farmer I talk to doesn’t want this administration to stay in office — they’ve done nothing to help the grain farmers,” said Sherman Newlin, who grows corn and soy in Illinois. “Yes, Trump put tariffs on China but most think it was needed, and he took care of the farmers by sending us payments.”

Trump doled out some $28 billion to farmers to soften the blow of his trade dispute with China, helping buoy US net farm income to a seven-year high in 2020. He also approved the year-round sale of higher blends of corn-based ethanol — something both DeSantis and Haley showed support for last week in a last-minute attempt to reach Iowa farmers before the caucus.

Bruce Rastetter, the founder and executive chairman of Summit Agricultural Group and a major Iowa Republican donor, on Saturday correctly predicted a resounding victory for Trump, saying the agriculturally-heavy state maintains nostalgia for his tenure in the White House.

Trump’s landslide win in Iowa is sure to draw Republican voters in other key states to the former president, Rastetter said in an interview in Chicago on Tuesday.

“You will continue to see him, I believe, win in the primaries and he’s going to be the nominee,” said Rastetter, an Iowa pork and ethanol mogul who served as an agriculture adviser during Trump’s transition period in the weeks following the 2016 election.

Key Republican backers are likely to start coming off the sidelines to give money to Trump’s campaign as they see the groundswell of grassroots support among rural voters, according to Rastetter.

“The movement is about the people in the countryside that want to create jobs,” he said. “Donors will come around as they recognize him as the nominee.”

Farmers remain a key voter base, with 39% of 605 growers in a nationwide poll commissioned by Agri-Pulse favoring the former president. DeSantis came in second with 19% and Haley third with 13%. Just 8% supported Biden.

Indeed, there were already signs last summer that this would be the case. A grower scouting fields at the Illinois Wheat Association crop tour last summer was carrying a load of Trump 2024 hats in his trunk, giving them away to other sympathizers. Many others also said they’d back Trump.

Interest Rates

Like many Americans, farmers have struggled with high interest rates under Joe Biden, making it harder to borrow. Inflation has also boosted the price of the inputs they buy such as seeds and fertilizers. Newlin, whose farm is about four hours from Chicago, says “Biden hasn’t done much to help lower it.”

“Trump is not perfect, but he gets the job done,” said Brad Feckers, a farmer in Shell Rock, Iowa. “Rural America saw the mess that Biden got us into.”

So far, polls are on the side of growers, with Trump taking the lead.

“Farmers seem to have a short memory,” said Michael McDougall, a managing director at Paragon Global Markets. “He sparked a trade war with China, which hurt farmers for some time as China avoided purchases of US farm goods. Then he had to pay them to compensate.”

Last August, Trump suggested a 10% tariff on all goods imported to the US. That could trigger retaliation from other countries and hurt American exports. Summit Agricultural Group’s Rastetter cautioned against cutting off all trade with China, saying that would harm Iowa farmers who have spent years building relationships with buyers in Asian markets.

“If we went down that road again, US farmers would have to be subsidized again — no matter who is in office,” said Chris Robinson, managing director of agriculture and commodities at TJM Institutional Services in Chicago. “You cannot decimate your food production system due to political issues. If we have China trade issues that curtail US farmers ability to export, those farmers will have to be compensated.”

--With assistance from Andrew Janes.

(Updates with more comments from Bruce Rastetter starting in sixth paragraph.)

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