Key Ag Policy Issues Ahead In 2025

The highly contentious 2024 Election is now history, and we are now moving rapidly forward with a new Administration and several new members of Congress. There will be new leadership in the U.S. Senate and some changes in lead roles on the Congressional Agriculture Committees. There are many key issues and possible policy changes that potentially could affect the agriculture industry, which will likely be addressed by Congress and the White House in the next couple years. However, there are also some concerns and questions with some of these policy initiatives as we move forward.
It appears that Brooke Rollins of Texas will be appointed to lead USDA and serve as the next Secretary of Agriculture. Other nominees by President-Elect Trump that could play a key role in ag and energy policy development include Lee Zeldin, former New York Congressman, as Director of the Environmental Protection Agency (EPA), North Dakota Governor Doug Burgum as Secretary of the Interior, Chris Wright to lead the Department of Energy, Jamieson Greer as US Trade Representative, and Tom Hor-man as the Border Czar. These nominees for leadership roles in the new administration must now be approved by the U.S. Senate after January 1, 2025. The leadership of Federal Departments can have a big impact on how various agriculture, energy, and environmental policies are implemented and administered.
The leadership of key Congressional Committees, such as the House and Senate Agriculture Committees, will have a major influence on future agriculture and energy issues. Republican Senator John Thune from South Dakota, who has strong ties to agriculture and energy policy, will now be the leader of the U.S. Senate. Arkansas Sena-tor John Bozeman will be Chair of the U.S. Senate Ag Committee and Minnesota Senator Amy Klobuchar will be in the Democratic leadership role on the Ag Committee. Republican Congressman G.T. Thompson will continue the Chair the U.S. House Agriculture committee and Minnesota Second District Congresswoman Angie Craig will be the new lead Democrat on the Ag Committee. Both Senator Klobuchar and Congresswoman Craig are well respected by the Minnesota agriculture industry and have a history of working across party lines on ag policy issues. Minnesota Senator Tina Smith (D) will continue to serve on the Senate Ag Committee and First District Congressman Brad Finstad (R) will continue to serve on the House Ag Committee.
Following is some perspective on some of the key agriculture and energy policy issues that are likely to be under consideration during the next session of Congress, or by executive action from the Administration:
• FINALIZING A NEW FARM BILL --- The 2018 Farm Bill originally expired on September 30, 2023 and was extended for one year; however, it has now expired again and will likely be extended for an additional year until September 30, 2025. The U.S. House Agriculture Committee passed its version of a new Farm Bill in the Spring of 2024; however, the bill has not been voted on by the entire U.S. House of Representatives. Senator Debbie Stabenow (D), current Chair of the Senate Agriculture Commit-tee, released a version of a new Farm Bill after the 2024 Election; however, it was not acted on by Congress.
Some members of Congress and many agriculture leaders have proposed increasing crop reference prices, enhancing crop insurance options, and improving risk pro-tection opportunities for livestock producers and farmers that raise specialty crops. There has also considerable discussion regarding the importance of conservation programs and how those programs can enhance ongoing carbon sequestration efforts. Most members of both political parties agree that the nutrition title of the Farm Bill, which accounts for over 80 percent of the annual Farm Bill spending, should not be separated from the Farm Bill; however, there are some differences on specific provisions in the nutrition title. There are also many other important programs and provisions that are part of the existing titles in the Farm Bill, including rural develop-ment, ag research and extension, trade promotion, livestock disease mitigation, and beginning farmer loans.
• DOWNTURN IN THE FARM ECONOMY --- Profit margins in crop production have worsened considerably in the past two years, which could put some farm opera-tions at the brink of financial disaster. Crop production expenses and land rental rates increased substantially in 2023 and 2024, while crop prices for corn, soybeans and wheat have remained below breakeven levels, and are now at the lowest levels in several years. For farm operators that experienced crop losses in 2024 due to weather issues, the financial situation is likely even more severe. The struggling profit margins for crop producers are somewhat linked to discussions on the new Farm Bill and the need for improved risk management tools for farmers. Swine producers have also had very low or negative profit margins for much of the time in the past two years. Some dairy and poultry producers have been dealing with the financial impacts of the highly pathogenic avian influenza (H5N1) outbreak in certain areas of the U.S.
• TARIFFS AND TRADE POLICY --- Tariffs and trade policy have received a lot of discussion since the recent Presidential Election. President-Elect Trump has threatened to impose large additional tariffs on a variety of goods being imported into the United States from China, Mexico, Canada, and other countries. If the U.S. implements additional tariffs, there is high likelihood that the other countries could impose retaliatory tariffs on products and goods that are exported by the U.S. into these countries. China, Canada and Mexico are the three largest trading partners for U.S. ag exports, including corn, soybeans, ethanol, pork, beef, and dairy products. The trade war with China during the first Trump administration had a significant impact on the commodity prices of soybeans, pork, and other agricultural products. Farm groups are also hopeful that the new administration and leadership in Congress can negotiate new bi-lateral trade agreements with other countries, in addition to normalizing relations with China, Canada and Mexico.
• RENEWABLE FUELS AND ENERGY --- The next Administration and Congress will need to decide what direction the U.S. takes toward further development of renewa-ble fuels industry through the renewable fuels standards (RFS), year-round E-15 blends, sustainable aviation fuel (SAF) and other incentives for renewable fuels, such as tax credits, etc. Ethanol and renewable diesel production have a major economic impact for farm operators, as well as for the overall rural economy in the Upper Mid-west. Many ag leaders point to sustainable aviation fuel (SAF) as a key growth opportunity for both the ethanol and renewable diesel industries in the future. However, federal agencies have set up very stringent farm-level practices that farmers must follow in order to be eligible to sell their corn and soybeans to processing plants for SAF production. Due to the restrictions being placed on U.S. farmers and the processing plants, some of the current feedstock for SAF production, such as used cooking oil, is being imported from other countries.
• IMMIGRATION REFORM --- We are likely to see some significant changes in U.S. immigration policy by the new Administration and Congress; however, many indus-tries, including the agriculture industry, could be significantly impacted by some of the potential immigration reform policies. Both production agriculture and the ag processing industry rely heavily on an immigrant workforce, so major changes in getting needed workers into portions of the U.S. could greatly affect the rural economy in some locations. What is really needed is for Congress and the Administration to develop an immigration policy that secures the U.S. border, but also allows needed immigration to satisfy labor shortages in some segments of the economy.
The new Farm Bill, the struggling rural economy, ag trade agreements, and the future of renewable energy are only a few of the issues affecting farm families and rural businesses. There are many other issues and programs that affect rural families, businesses, and communities in a variety of ways. These include family health care ac-cess and costs, expansion of broadband coverage in portions of rural areas, infrastructure needs, assistance for beginning farmers, and other issues affecting agriculture and rural communities. The next few months should be interesting as the policy initiatives of the new Administration and Congress are unveiled.
Note - For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Phone - (507) 381-7960; E-mail - [email protected]