Trump lowers farm equipment tariffs to 15% as midterm concerns loom

President Donald Trump on Monday cut tariffs on agricultural and industrial equipment to 15% from 25%, offering targeted relief to the farm sector as Republican lawmakers warn of midterm losses in agricultural states.

"The adjustments appear to be more about the midterm elections than true relief for farmers," said Barry Appleton, a law professor and co-director of the Center for International Law at New York Law School. "Farm bankruptcies are soaring, farm sentiment is declining, and Republican senators are openly warning their party is heading toward midterm losses in key agricultural states."

The proclamation lowers tariffs on agricultural machinery — including combines, harvesters, and HVAC systems — to 15% from 25%. It extends the 15% rate to mobile industrial equipment such as bulldozers and forklifts when imported from countries with a US trade deal. Foreign companies can qualify for a 10% duty rate if their capital equipment contains at least 85% US-melted and poured or smelted and cast steel or aluminum by weight. The changes take effect June 8 and expire Dec. 31, 2027.

The adjustments follow Trump's hike of steel and aluminum tariffs to 50% in June 2025 and a flat 50% rate for goods made entirely of aluminum, steel, or copper in April 2026. The latest move carves out exceptions for equipment-intensive sectors while maintaining the broader tariff structure, showing the White House is balancing protectionist trade policy with political pressure from the farm belt.

The proclamation also adds two new categories of derivative products subject to 25% duties: steel racks and aluminum lithographic plates, the White House said. The order frames the changes as temporary measures "to spur near-term investments that will rebuild the Nation's industrial base."

The Section 232 tariffs on steel, aluminum, and copper were first imposed during Trump's first term in 2018 under the Trade Expansion Act of 1962, which allows tariffs on imports deemed a threat to national security. Trump renewed those tariffs in April 2025 and escalated them to 50% the following June.

Tariff Escalation and the Farm Belt Backlash

The latest round of adjustments follows a pattern of escalating metal tariffs that have drawn criticism from agricultural groups. After the previous tariff increases in 2018 and 2025, US farm equipment costs rose as domestic steel and aluminum prices climbed, squeezing margins for crop producers already facing low commodity prices. The current average US tariff on Chinese goods stands at about 20% after multiple rounds of escalation since 2018, according to Census Bureau data.

Farm bankruptcies have accelerated in key agricultural states, and Republican senators from the Midwest have publicly warned that the party's trade policies risk alienating rural voters ahead of the November midterms. The 15% rate on farm equipment represents a roughly 40% reduction in tariff costs for affected imports, though the relief is temporary and set to expire at the end of 2027.

Copper futures rose 2.7% to $5.64 per pound on Monday, while aluminum slipped 1.2% to $3,314 per ton, reflecting mixed market reactions to the tariff adjustments. Gold gained 3.8% to $4,713 per ounce as broader geopolitical uncertainty persisted.

This article is for informational purposes only and does not constitute investment advice.