LUBBOCK, Texas (RFD NEWS) — Questions are growing about how tariff revenue is used and whether farmers benefit, as trade policy again reshapes agricultural markets and federal spending priorities.
Dr. Bart Fischer of the Agricultural and Food Policy Center at Texas A&M University notes tariff revenue flows through longstanding statutory channels rooted in the Agricultural Adjustment Act of 1935. Section 32 requires 30 percent of customs duties to be directed toward agricultural priorities, including export promotion, domestic consumption support, and the restoration of farmers’ purchasing power.
Tariff collections have climbed sharply. Customs duties rose from $34.6 billion in 2017 to $70.8 billion in 2019, and the Congressional Budget Office projects duties could jump from $77 billion in 2024 to about $418 billion by 2026 under expanded tariff use.
In practice, most Section 32 funds support nutrition programs rather than direct farm payments. USDA retains limited authority for commodity purchases and assistance, while appropriations rules cap farmer-directed support at roughly $350 million in carryover funds annually — a small share if 2026 projections hold.
The structure leaves policymakers relying on tools like Commodity Credit Corporation programs for farm relief despite rising tariff revenues.
Farm-Level Takeaway: Tariff revenues rarely flow directly back to farmers.
Tony St. James, RFD NEWS Markets Specialist
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