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U.S. President Donald Trump’s %Tariff regime is leading to sharp price increases for American farmers.

In particular, the tariffs that Trump has imposed on imports from neighbouring Canada are having what’s being described as a “devastating effect” on America’s agriculture sector.

A 10% tariff on fertilizer imports and 25% tariff on imports of farm equipment and machinery is having an immediate impact, say farmers and their representatives.

The South Dakota Farmers Union says the cost of fertilizer and equipment has risen sharply for farmers just as they plan their spring crop plantings.

Canada is the world’s largest producer of potash, the active ingredient in fertilizer, and about 90% of the fertilizer used on American farms comes from Canada.

Additionally, much of the farming equipment used in America is made, at least in part, north of the border in Canada.

The North Dakota Farmers Union says that 25% tariffs imposed on steel could also make purchases of necessary farm equipment much more expensive.

The price of specialty no-till drills that plant seeds without disturbing the soil have seen their cost of $1 million U.S. rise by an additional $250,000 U.S. due to tariffs, notes the North Dakota union.

U.S. farmers also worry that they’re losing an important export market next door as Canadian grocery stores ban American produce and food products and adopt a “Buy Canadian” mindset.

U.S. agriculture stocks are taking a hit on the tariff impacts, with shares of %ArcherDanielsMidland (NYSE: $ADM ), an American food processing and commodities trading firm, down 12% in the last month and trading at $43.32 U.S. per share.


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