A new portal to request tariff relief is incoming from the Trump administration. Unfortunately for farmers, they are not the direct target this time around.
The U.S. Customs and Border Protection Consolidated Administration and Processing of Entries is now open with the expressed intent to “streamline the submission and processing of valid refund requests for duties imposed under the International Emergency Economic Powers Act.” In plain English, CAPE is where businesses go to apply for refunds from tariffs levied against various U.S. companies.
That could be a real boon for some American agribusinesses. For example, a farm machinery company that imported parts for a tractor or sprayer can now seek refunds of tariffs paid on those imports. For a fertilizer company importing nitrogen or potash, those same benefits could apply, too.
Could U.S. farmers also benefit? That situation is a bit murkier.
“Farmers will not be applying for refunds, as that will be done by whoever directly paid the tariff to the federal government,” according to Jeffrey Dorfman, professor of agricultural economics at North Carolina State University.
It is possible that some companies will issue refunds to customers on a “pass-through basis,” but some are skeptical that this will happen, Dorfman added.
“We also may see implicit refunds to farmers through lower prices on future purchases, as importing firms try to keep good customers happy and loyal,” he said.
Searching for refunds
Businesses seeking relief often have one or two simple questions, according to Pete Mento, director for Baker Tilly, a global accounting and advisory firm.
“How do I get my money, and when do I get it?” he said. “The other question they are asking is how realistic will it be to get this money back? Some of these requests might not come back at all.”
The biggest mistake Mento sees is when companies blindly upload their data without knowing whether what’s behind it is correct.
“You’re just asking for trouble [if you do this],” he said. “It would be just like filing a tax report without knowing if any of the things you put in there are actually correct.”
As with many things in life, it’s better to measure twice and cut once.
Farmers could also contact a company they have done business with that has filed for refunds through the CAPE portal. Here’s how Mento would frame that request: “I bought this stuff, you told me you passed the tariffs onto me, when can I expect to get some of this money back?”
Keep in mind that companies have no legal obligation to pass along any refunds they secure. But Mento is optimistic that some companies will issue tariff rebates, primarily to generate goodwill among their farmer customer base.
“We have spoken to a lot of companies where that’s their intention,” he said. “As much as they can recover, they intend to give it back to their customers.”
Ultimately, it may be prudent to deploy a wait-and-see approach for now, Dorfman concluded.
“Exactly what will happen is not clear to me yet,” he said. “We probably need to wait another month or so to see how things develop.”
Go back to 1935
Another wrinkle in the whole situation is separate from CAPE and stretches all the way back to the Agricultural Adjustment Act of 1935, noted Bart Fischer and Joe Outlaw, writing for our sister publication Southwest Farm Press.
“From 2024 to 2026, the Congressional Budget Office estimates that customs duties will increase by 443%, from $77 billion to $418 billion, a reflection of Trump’s renewed use of tariffs in his second term,” they pointed out. “So, if billions of dollars are collected in tariff revenue, where does it go?”
The key lies in Section 32 of AAA. For example, 30% of tariff revenue is to be used to:
- encourage the export of agricultural products
- encourage the domestic consumption of farm products by diverting surpluses and increasing usage
- reestablish farmers’ purchasing power by making payments in connection with the normal production of any agricultural commodity for domestic consumption
A clause in Section 32 stipulates that collected tariffs can be used to “reestablish farmers’ purchasing power by making payments in connection with the normal production of any agricultural commodity for domestic consumption.”
Some see Section 32 funds as an obvious choice to help farmers, given that other countries retaliated against U.S. products and farmers’ purchasing power was diminished by inflation over the past five years. That option has not been considered as a viable solution so far, according to Fischer and Outlaw.
“If the Congressional Budget Office’s projections for fiscal year 2026 hold, Congress will essentially be dictating that no more than 0.28% of the $125 billion in tariff revenue flowing to USDA can be used to help farmers,” they wrote.