California’s $59bn agricultural industry is bracing for disruption as Donald Trump’s tariffs continue to spike tensions and trigger economic turmoil with China – one of the state’s biggest buyers.
California is the country’s breadbasket, supplying roughly one-third of US vegetables and 75% of its fruits and nuts. But it also exports much of its produce – close to $24bn worth in 2022. This means farmers in the state could lose out significantly as China imposes retaliatory tariffs on US goods.
The threat of another prolonged trade war has contributed to growing uncertainty in an industry where decisions often have to be made long before harvests or sales. It’s difficult for producers to decide to cull or keep dairy cows from their herds, rip plants tended to for years from the soil or pluck trellises of grapevines from their pastures.
Already grappling with extreme weather events that have damaged or destroyed crops and water restrictions that added challenges, a spate of Trump policies – including attacks on agricultural research, a funding freeze of billions from the US Department of Agriculture, and crackdowns on migrant workers – have left farmers reeling.
“The uncertainty is probably more of a problem than the tariff itself,” said Zachary Williams, sales director for Stewart & Jasper Orchards in Newman, California. “Uncertainty about whether there will be, or won’t be, is a little harder to plan around.”
The issue is sharply affecting California almond growers, who collectively export close to three-quarters of what they grow. Roughly 76% of almonds eaten around the world currently come from the state, but Australia, the second-largest producer, could cater to countries unwilling to pay higher prices.
Fallout from Trump’s first-term trade war is still fresh on the minds of many farmers and growers in the Golden state, when they were hit hard by Chinese retaliation.
“The first trade war was a disaster for California agriculture and in particular for tree nut exports – and they never really recovered,” said Colin Carter, professor emeritus of agriculture economics at the University of California, Davis. “Prices for pistachios and almonds have only just begun to rebound, he added, “but now the tariffs are even higher”.
The expansion of almond acreage stalled during the first trade war and walnut orchards were ripped from the ground. “A lot of farms were put up for sale, bankruptcies have impacted some processors, and that affected farms as well,” Carter said.
That trade war caused a $27bn loss to US agriculture. California tree nut growers were among the hardest hit, with losses at $880m, according to a 2022 analysis by UC Davis researchers.
Few saw a full recovery, even with a 2018 $12bn federal aid package for US farmers. Even though almond prices fell by more than a dollar a pound, “California’s farmers were largely left out of the government compensation schemes,” Carter and his colleagues found in an analysis published late last year. Midwestern farmers, he said, received the bulk of federal subsidies.
This time around, Carter said, it could be worse. A new trade war could cost $6bn per year and wipe out one-quarter of California’s agricultural exports. “This would have a ripple effect across the state, from the large almond orchards in the Central valley to the small family vineyards scattered throughout wine country,” according to Carter’s analysis.
Officials at the USDA have hinted that the administration might offer aid funds for impacted farmers again, but the federal government might not be in a position to offer as much support or recovery tools if the Trump administration continues slashing staff, programs and budgets.
Almond farmers are well aware of the risks. Rick Kushman, a spokesperson for the Almond Board of California, said they are “closely monitoring the impacts” from both retaliatory levies and US tariffs that could affect imported materials the industry relies on.
Advocates for growers have also pushed officials to proceed cautiously.
“Almonds remain California’s top agricultural export, $5.8 billion in 2024, underscoring their importance to both the state and national economies,” Alexi Rodriguez, the president and CEO of the industry advocacy group Almond Alliance, wrote in a letter to agriculture secretary, Brooke Rollins, and trade representative Jamieson Greer in March. She called for “careful consideration to be given to the risks of retaliatory tariffs”.
“When US tariffs are imposed, the resulting retaliatory tariffs could significantly disrupt US almond exports, depress farm prices, and further shift market share to competitors,” she said, noting that California almonds contribute more than $9bn to the state’s economy.
But even as Trump takes grave risks with California agriculture in his attempts to rework global markets, few in the industry have been outwardly critical of his actions. Many growers are instead focusing on their confidence that the president will come through with campaign promises to make more water available for thirsty crops, even as supplies grow shorter.
A single almond requires more than a gallon of water to grow and trees have to be irrigated throughout the year. The nuts are controversial in the drought-prone state, where regulators are working to rein in strain on underground aquifers. Meanwhile, farmers face increasingly steeper fines and fees, along with challenges to maintain their orchards.
Along Highway 5, a thoroughfare that snakes through the heart of California’s ag-land, large signs still signal the region’s support for Trump and its ire against water restrictions. Farmland sprawling across the state’s rural Central valley is still a bright-red belt in a deeply blue state.
Carter said he finds it ironic. Tariffs could prove even more costly than California’s last devastating drought.
“The president says he supports agriculture but these trade wars send an opposite signal,” Carter said. “We are seeing that now. It is coming again. Foreign countries know which commodities to target.”
The Associated Press contributed reporting
