Since U.S. President Donald Trump’s return to the White House, he has put the squeeze on trading partners from Canada to Cambodia.
But one U.S. trading partner seems to be getting preferential treatment, and Americans are starting to notice.
On Wednesday, Politico reported that the Trump administration is seeking to quadruple the tariff-free allowance on Argentine beef imports to 80,000 tonnes, an amount so large that there are doubts whether Argentina could even fill it.
Trump first floated the idea during a chat with reporters on Air Force One on Oct. 19, saying it would help to lower consumer prices.
As anger builds in the U.S. over the apparent favouritism shown to Argentina, Republican lawmakers from cattle-ranching states are breaking ranks to criticize the moves openly on social media, as are pro-Trump influencers.
The issue has been picked up by the small but growing cohort of Republican legislators who have lately been marking differences with the president, including Georgia Rep. Marjorie Taylor Green and Rep. Thomas Massie from Kentucky. It also quickly became fodder in an ongoing feud between Trump and California Gov. Gavin Newsom.
Trump’s response falls flat
It all led Trump to respond in a Truth Social post that suggested American ranchers weren’t sufficiently grateful for all he’s done for them.
“The Cattle Ranchers, who I love, don’t understand that the only reason they are doing so well, for the first time in decades, is because I put Tariffs on cattle coming into the United States, including a 50% Tariff on Brazil,” Trump wrote. “It would be nice if they would understand that, but they also have to get their prices down, because the consumer is a very big factor in my thinking, also!”
It’s not unusual that Trump would want to appear to be doing something about high food prices, said David P. Anderson, a professor of agricultural economics at Texas A&M University. “It’s in this overall context of higher prices for consumers across the board.”
But high prices are a boon to farmers, he told CBC News.
“For many producers it’s really about time we had high prices. We went through many years of low prices, rising costs, drought, and it’s a chance to recoup some of those losses and begin to rebuild.”
The move to import beef from Argentina is unlikely to move prices much, he said, but “it’s certainly unpopular with farmers and ranchers.”
One rancher association, which endorsed Trump in the last election, said importing Argentinian beef “undercuts the future of family farmers.”
In a statement to CBC News, Nebraska Cattlemen (formerly the Cattlemen’s Association) said it opposes “government interference” in the market.
“Introducing unnecessary price volatility … risks a negative impact on the one true long-term solution for currently elevated beef prices — expansion of the U.S. beef cattle herd.”
Anderson agreed that growing the U.S. herd would be more likely to bring prices down than boosting imports from Argentina. “Our problem right now is that we have fewer cattle than at any time since 1961,” he said.
Currency swap and soybeans
But the cattlemen are not the only farmers to feel that the ground has been cut from under them in order to favour competitors in distant Argentina.
On Wednesday, the Trump administration effected a $20 billion currency swap of U.S. dollars for Argentine pesos. The move is intended to shore up the falling peso just days before Argentina’s midterms, in which President Javier Milei faces an increasingly disenchanted electorate.
For the U.S. Treasury, trading dollars for a devaluing foreign currency doesn’t appear to be a winning financial move.
“Stabilizing Argentina is America First,” Treasury Secretary Scott Bessent argued. “We do not want another failed or China-led state in Latin America.”
Once again, though, the moves to help Argentina appear to have hurt U.S. farmers. Iowa Republican Sen. Chuck Grassley took to social media to ask “Why would USA help bail out Argentina while they take American soybean producers’ biggest market?”
Indeed, President Milei clearly wasn’t thinking about U.S. domestic sensitivities when he used the fiscal space gained from the bailout to lift export taxes on his country’s soybeans, a major source of revenue for his government, deeply unpopular with Argentina’s farmers.
Milei claimed that tax cut allowed Argentina’s farmers to get the best price for their soybeans in 25 years.
“A lot of that bailout went to assist Argentina’s farmers,” said John Boyd Jr. of the National Black Farmers Association (NBFA). “They turned around and sold their soybeans to China and pretty much stole our market there.”
October would normally mark the beginning of U.S. soybean sales to China, its biggest market. But Trump’s tariffs, combined with the fresh supply of cheap soybeans from South America, have caused U.S. sales to flatline, he said.
“The soybean industry in the United States is at a standstill,” Boyd told CBC News from his farm in Boydtown, Virginia. “Many of the grain elevators are full and soybeans just aren’t moving.”
Boyd said he wasn’t buying the claims in Trump’s Truth Social post.
“His tariffs, he said, were helping the beef industry. And it’s not. It’s killing us. I’m glad to see other farmers start to speak out and let the president know we’re at a real disadvantage when you bail out a foreign country but you won’t help your farmers right here at home.”
MAGA darling Milei
Foreign leaders are typically wary of the Trump Oval Office, but Argentina’s Milei could hardly have received a warmer welcome on Oct. 14.
“We just want to see Argentina do well,” Trump told reporters. “They have a great leader.”
Trump made it clear that U.S. help depended on Argentine voters choosing Milei’s party in the country’s midterms.
“If he loses, we are not going to be generous with Argentina,” Trump said. “We’re helping a great philosophy take over a great country.”
Milei has been careful to cultivate his friendship with the White House.
Milei was once a strong supporter of Ukraine, and its president Volodymyr Zelenskyy even travelled to Buenos Aires in December 2023 to attend Milei’s inauguration. But just days before Trump’s infamous Oval Office ambush of Zelensky in February, Argentina changed its voting pattern on Ukraine in the United Nations.
As western countries such as Canada, Britain and Australia have turned sour on the Netanyahu government, Argentina has reversed its UN votes, essentially taking a place once held by Canada as the only unconditional vote Israel and the U.S. could truly count on beyond a small group of Pacific Islands.
But personal affection and ideological affinity may not be the only motive for helping. American hedge fund billionaires made big bets on Argentina, and they include Rob Citrone and Stanley Druckenmiller, both friends and former colleagues of Scott Bessent. Blackrock, Fidelity and Pimco hedge funds are also heavily invested in Argentina, reports the New York Times.
Some of the people and companies invested in Argentina are also Trump donors. Others, such as Blackrock, are invested in Trump companies including Trump Media.
Talks break down
Canada, like most countries, has approached the Trump administration with a traditional strategy that seeks rational compromises while stressing the benefits of trade for both nations. But there is little evidence that such arguments move the Trump administration.
What clearly does move the Trump administration is money directed to Trump and people in his inner circle.
Kevin Hassett, director of the National Economic Council, told reporters in Washington on Friday that U.S. President Donald Trump’s social media posts cutting off trade talks with Canada reveal ‘his frustration with the actions and postures of the Canadians through months of negotiations.’
That strategy has paid huge benefits for countries such as Qatar and UAE. The Emiratis’ $2 billion investment in Trump’s crypto-currency venture World Liberty Financial was swiftly followed by the evaporation of longstanding U.S. objections to giving UAE sophisticated AI-capable chips, for fear they would turn up in new Chinese weapons. UAE was able to acquire billions of dollars’ worth of NVIDIA chips.
Qatar’s gift of a luxury jetliner to Trump was followed by an extraordinary security guarantee, given without congressional approval, that committed U.S. troops to defend the tiny emirate as if it were a NATO member.
The best example of the flattery approach was perhaps Britain’s use of its monarchy to puff up Trump’s vanity and love of pageantry with carriage rides and state dinners. Britain secured a lower tariff rate than its continental peers. But it still had to settle for disadvantageous terms of trade despite running a trade deficit with the U.S.
The evidence suggests that while flattery is cheaper, buying favour is more effective. The conventional negotiating approach pursued by Canada has shown weaker results than either. But as a democracy that operates with rule of law, it’s not clear what else Canada could do.
Argentina’s success with the Trump administration may reflect the fact that it hits both of what seem to be the strongest notes with the Trump administration. Not only is Milei an unabashed flatterer and imitator, but his ask aligns closely with the personal financial interests of people in Trump’s circle.
In the end, as is so often the case with U.S. politics, domestic considerations may weigh most heavily. Trump’s most reliable constituency has been U.S. farmers, and his standing with them is beginning to suffer from his trade actions.
“A lot of American farmers are right on the verge of make or break,” said Boyd, “and we’re leaning towards break. Farm bankruptcies are up, farm suicides are up, farm foreclosures are up. And here we have the president saying the price of beef has to come down. That’s something we don’t want to hear.”
