Rising concerns about climate change have led to the introduction of carbon policies around the globe. In January 2019, the Energy Innovation and Carbon Dividend (EICD) Act of 2019 was introduced to the House of Representatives.1 The act proposes a carbon tax of $15/ton of carbon dioxide equivalent (t-1 CO2-e) starting in calendar year 2019, and covers entities such as refineries, coal mines, and natural gas producers. Adjusted for inflation, the tax increases $10 each year and is subject to adjustments given the under- or over-achievement of annual emission reduction targets. The tax ceases if greenhouse gas (GHG) emissions are at or below 10% of the 2016 GHG emissions.

There have been a number of agricultural market movers (issues that change the direction and intensity of price moves) over the past year; however, most of these movers cancel each other out. Weather problems limited supplies and pushed prices higher, but the trade disputes and tariffs limited usage and offset the price impacts. With the passage of the USMCA and the signing of trade deals with China and Japan over the past few months, there is some positive news on the trade front. However, as the market reaction to the US-China trade deal signing indicates, agricultural markets are not interested in the political deals, but in actually seeing trade flows change due to these deals.

The Agriculture Improvement Act of 2018 (2018 Farm Bill) introduced major changes to the Agricultural Risk Coverage (ARC) and the Price Loss Coverage (PLC) programs, and Iowa State University Extension and Outreach has developed new tools to help farmers and landowners make informed decisions about these programs.

The costs and benefits of the trade war are unevenly distributed across the United States. Looking at the raw impact on commodity prices, such as soybeans, we know that it disproportionately affects farmers in the Midwest. The Phase One Trade agreement between the United States and China promises substantial relief; however, we question if the Phase One targets are realistic (See “The Phase One Trade Deal: Projections and Implications” by Chad Hart and Lee Schulz in this issue). Thus, it is important to consider just how much is at stake for different states and the nation as a whole.