Authors: Bart L. Fischer and Joe L. Outlaw
While the agricultural industry in the U.S. has long relied on trade as a major demand outlet, the agricultural trade deficit ballooned to more than $100 billion in total over the last 4 years, and at the same time, the United States has been experiencing unparalleled growth in export competition. While the current administration is using retaliatory tariffs as a tool to attempt to reset the deck, we increasingly are hearing from various corners that the U.S. cannot trade its way out of the low-price scenario we are facing for row crops. While we might take a more nuanced view than that assessment, it does beg the question of what the U.S. is doing—and what more could be done—to expand demand here at home for agricultural commodities.
While much of that work falls to the private sector, the Federal government certainly plays a role, including by both directly purchasing products and by providing incentives. With respect to purchases, the U.S. government has long been a significant buyer of U.S. agricultural commodities. For example, for more than 200 years, the U.S. government has been purchasing U.S.-grown commodities to donate overseas in the form of emergency food aid. In addition, the Buy American Act (P.L. 72-428) was signed into law in 1933—a contemporary of the nation’s first farm bill—and required the U.S. government to give preference to U.S.-made products in all its purchases. As another example, the Berry Amendment is a statutory requirement originally adopted in 1941 “that restricts the Department of Defense (DoD) from using funds appropriated or otherwise available to DoD for procurement of food, clothing, fabrics, fibers, yarns, other made-up textiles, and hand or measuring tools that are not grown, reprocessed, reused, or produced in the United States.”[1]
While government purchases continue to be a significant demand source, the U.S. government has also been doing more to incentivize the private sector to purchase U.S.-grown commodities. Perhaps the most notable example is the Renewable Fuel Standard (RFS) and the impact that ethanol has had on the demand for corn and other feedstocks. That debate continues today as Congress considers whether to authorize the sale of year-round E15 and as the details are worked out on 45Z and sustainable aviation fuel (SAF). While we are all familiar with the biofuel examples, there are other examples being introduced in Congress, including the Grown in America Act of 2025 (H.R. 1707) and the Buying American Cotton Act of 2026 (H.R.7230/S.1919). Both bills are starting to pick up steam with a growing list of co-sponsors.
- The Grown in America Act of 2025 was proposed by the Ag Investment for America Coalition which is made up of a broad cross-section of commodity organizations and domestic food and beverage manufacturers.[2] It was introduced in the House in the 119th Congress by Rep. David Kustoff (R-TN-8) and includes 32 bipartisan co-sponsors (including 4 original sponsors). The bill aims to expand demand for domestic agricultural commodities and encourage additional investment in domestic supply chains by establishing a tax credit for food and beverage manufacturers that source their raw agricultural inputs from U.S. farmers and ranchers. The tax credit would be equal to 25% of the value of domestically sourced agricultural commodities used in the production of a food or beverage for human consumption.
- The Buying American Cotton Act of 2026 was proposed by the National Cotton Council.[3] It was introduced in the House in the 119th Congress by Rep. Greg Murphy (R‑NC-3) and includes 70 bipartisan co-sponsors (including 23 original sponsors). It was introduced in the Senate by Sen. Cindy Hyde-Smith (R‑MS) and includes 14 bipartisan co-sponsors (including 3 original sponsors), including Sen. John Boozman (R-AR), Chairman of the Senate Committee on Agriculture, Nutrition, and Forestry. The bill aims to encourage the consumption of U.S.-grown cotton, including the consumption of products made from such cotton, by establishing a tax credit for retailers. The tax credit would be equal to 18-24% of the value of the U.S.-grown cotton contained in the article of clothing (with the range depending on whether it was manufactured in a country with whom the United States has a free trade agreement in place).
These bills have 15 co-sponsors in common, including the support of Rep. G.T. Thompson (R-PA-15), Chairman of the House Committee on Agriculture. Between the America First focus of the Trump Administration and a growing bipartisan interest on Capitol Hill post-COVID in bolstering U.S. supply chains, we can envision both bills receiving favorable treatment on Capitol Hill.
Given the growth in export competition, U.S. farmers are going to need all of the domestic solutions they can get to increase prices. All of the alternatives discussed in this article will do that, and the sooner the better.
[1] https://www.trade.gov/berry-amendment
[2] https://www.aginvestmentforamerica.com
[3] https://www.cotton.org/news/releases/2026/ncc-on-baca-house-intro.cfm
