IT IS easy to convince Iowa farmers that the trade war with China has substantial costs, as current agricultural commodity prices reflect reduced export demand. Rather than bear the burden of retaliatory tariffs, China moved toward other sources and substitutes for soybeans (see related article by Chad Hart and Lee Schultz in this issue of the APR) . The adverse export-demand shock is absorbed within the US market by inventory (and eventually production) adjustments and price reductions, and farm revenues fall as a result. This narrative might well outline the primary mechanism by which many Iowa farmers feel the pain of the trade war, but it is woefully incomplete.