Indiana’s farmers and agricultural businesses lost an estimated $607 million as a result from the latest U.S.-China trade war, according to new research from North Dakota State University—part of a broader $14.9 billion annual loss in U.S. agricultural exports tied to retaliatory tariffs imposed by Beijing.
The findings underscore how a geopolitical dispute has rippled into the Corn Belt, where China has long been a cornerstone buyer of soybeans, corn and other commodities that anchor Indiana’s farm economy.
The study isolates the effect of tariffs imposed beginning in March 2025, when China layered new retaliatory duties on U.S. agricultural goods, including a fentanyl-related tariff and a broader “reciprocal” tariff that at one point reached 125 percent. Using an econometric model designed to filter out other market forces—such as global price shifts and weather-driven supply changes—researchers concluded that the tariffs alone drove a steep contraction in U.S. exports to China over the following year.
For Indiana, where soybeans and corn dominate the agricultural landscape, the losses track closely with the commodities hit hardest. Nationally, soybeans alone account for roughly $6.8 billion of the export decline—nearly half the total—followed by beef and cotton at about $1.3 billion each. Corn, another Indiana staple, contributed an estimated $333 million to the shortfall.
The scale of the disruption is difficult to overstate. U.S. agricultural exports to China fell from $24.5 billion in 2024 to just $8.4 billion in 2025—a two-thirds drop and the lowest level in nearly two decades. While some shipments were redirected to other countries, China’s absence from the market created a gap that other buyers have not fully filled.
Indiana ranks among the states most exposed to that shift, though it sits behind larger agricultural producers such as Iowa, Illinois and California. Still, the $607 million figure places it firmly in the top tier of affected states, reflecting both its production volume and its reliance on export-driven commodities.
The losses also exceed those from the previous U.S.-China trade conflict in 2018 and 2019. On an annualized basis, the current round of retaliation is about 41 percent larger, according to the analysis, highlighting how deeply intertwined the two countries’ agricultural trade has become—and how disruptive its unraveling can be.
Yet the picture is not entirely static. A series of negotiations in late 2025 and spring 2026 has begun to stabilize the relationship, even if it has not restored it. A November truce reduced some tariff pressures, and a May 2026 framework agreement outlined new commitments from China, including a pledge to purchase at least $17 billion in U.S. agricultural products annually through 2028, alongside significant soybean imports.
If fully implemented, those commitments could push total U.S. agricultural exports to China back into the $28 billion to $30 billion range—potentially exceeding pre-trade-war levels. But economists caution that such outcomes depend heavily on follow-through, market conditions and the durability of the political détente.
For Indiana farmers, that uncertainty is now part of the operating environment. The state’s agricultural economy remains fundamentally tied to global markets, even as those markets become more volatile and, at times, less predictable.
The research makes clear that while trade flows can shift and adapt over time, the immediate costs of disruption are real—and, in places like Indiana, substantial.
Source: North Dakota State University
