The Quarterly: Historic Shift in Trade Policy Risks Long-Term Loss of Trust

Brian Earnest , Tanner Ehmke , Jacqui Fatka , Rob Fox , Corey Geiger , Jeff Johnston , Emmie Noyes , Christina Pope , Abbi Prins , Billy Roberts , Lauren Sturgeon Bailey and Teri Viswanath

April 10, 2025

The long-anticipated “reciprocal” tariff plan turned out to be much more impactful than businesses had expected, and significant uncertainty remains as we enter a 90-day negotiating period with many of our trade partners. Regardless of how those negotiations evolve, the increasingly unpredictable nature of U.S. trade policy will have long-term implications for our trade relationships. Given the anxiety over tariffs and other news coming out of Washington D.C., consumer and business sentiment has turned sharply negative over the past two months. However, we will have to wait for the “hard” data to see if that translates into a weakening economy.

Grain, oilseed, and cotton prices have fallen by roughly 50% since 2022, but input costs have not seen a parallel drop. Uncertainty around the seemingly endless tariff drama, a less favorable federal biofuels policy environment, and an expected record-large South American harvest provide a downbeat outlook. Given low feed costs and strong consumer demand, meat, livestock and dairy markets have been enjoying generally good profitability, but tariff uncertainty will continue to weigh on markets for the foreseeable future.

Amid surging demand for electricity across the nation, a tariff-induced spike in the cost of transformers will further accelerate the costs of delivery. The new administration is taking a “technology agnostic” view, which may speed up the broadband buildout in underserved regions but won’t provide the advantages of a “fiber-first” approach.

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