Trump administration officials have postponed and altered a government forecast, which projects an increase in the U.S. trade deficit in agricultural goods. This decision comes despite the forecast contradicting President Donald Trump's assertion that his economic policies, including tariffs, will mitigate trade imbalances. According to sources familiar with the situation, the data was not published due to its unfavorable depiction of the trade deficit.
The report, dated May 29 but released on Monday, includes unaltered figures akin to those in the unredacted version, shared by the anonymous informants involved in the decision-making process. The Agriculture Department's quarterly report, influential among policymakers, farm groups, and commodities traders for its import-export analysis of key farm commodities, experienced an atypical release that may raise concerns about possible political interference in routine government reports.
"Objectivity is really key here and the public depends on it," commented Joe Glauber, a former USDA chief economist. "To lose that trust would be terrible."
A USDA spokesperson attributed the delay to an "internal review." Alec Varsamis from the USDA stated, "The report was hung up in the internal clearance process and was not finalized in time for its typical deadline." The spokesperson indicated that "the Department is undergoing a review of all of its non-statutory reports, including this one, to determine next steps." The timeline or the potential release of the written analysis remains undetermined.
The revised forecast, following the February publication which anticipated a $49 billion deficit, now estimates a record $49.5 billion for the current fiscal year, surpassing the previous peak of $31.8 billion in fiscal 2024.
During the Biden administration, Republicans leveraged similar deficit projections in quarterly reports to critique then-Secretary Tom Vilsack's efforts in boosting U.S. farm exports. Historically, agriculture secretaries have used these forecasts to advocate policy.
The report indicates the effects of Trump's fluctuating tariffs, as noted by sources. The president has announced elevated tariffs on China and "reciprocal" duties amounting to at least 10 percent on major U.S. trading partners.
Former USDA chief economist Joe Glauber highlighted that tariffs play only a part in trade deficit variations: Americans' preferences for non-domestically produced goods, a strong dollar, and agricultural imports' stable prices contribute significantly to deficits.
Two federal court rulings recently impacted these reciprocal tariffs, adding uncertainty for the agriculture sector. Amid shrinking foreign markets and increased inflation, farmers face a challenging economic environment compared to Trump's initial term.
Agriculture Secretary Brooke Rollins has remained a staunch advocate for Trump's tariffs, emphasizing their necessity in dismantling trade barriers, including non-tariff obstacles. Rollins currently heads a trade mission to Italy, with further plans to promote American agricultural commodities abroad later this year.
Source: Politico