Trade Talk: Developments Ahead of August Deadline

Preliminary Agreements Could Influence Corn, Ethanol, and DDGS Exports

Trade negotiations have increased as the August 1, 2025 tariff deadline approaches. Recently, there were several preliminary agreements announced between the United States (U.S.) and major trading partners. These announcements do not represent finalized trade agreements but do offer a broad framework to guide further negotiations.

Breakdown by Country:

Japan

An agreement was announced by the White House on July 23 that covers automobiles, airplanes, agriculture products, and more. Although specific details are limited, the framework includes that the Japanese have agreed to invest $550 billion in the U.S.

Also outlined are plans for $8 billion in U.S. ag purchases, including U.S. rice, which is politically sensitive for the Japanese. Also included are U.S. corn and U.S. ethanol purchases.

Japan is the U.S.’s second-largest foreign corn customer and a growing market for U.S. ethanol.

Indonesia

A deal was announced that includes a reduction in Indonesian tariffs on U.S. goods. In return, the U.S. will apply a 19% duty on Indonesian goods.

Indonesia is a significant DDGS market for the U.S. and is a target for U.S. ethanol exports.

Philippines

President Trump announced a 19% tariff rate for imports from the Philippines in return for tariff reductions for U.S. automobiles.

The Philippines’ leaders have indicated a desire to increase imports of U.S. wheat and soybeans. 

USTR Section 301 Investigation

The U.S. Trade Representative’s office announced an investigation into unfair trade practices the Brazilian government has engaged in, explicitly including tariff and non-tariff barriers to U.S. ethanol exports.

Once the top foreign market for U.S. ethanol, Brazilian barriers to trade have reduced U.S. exporters’ ability to access the market.



What It Means Going Forward

While the frameworks are not finalized agreements, they provide a foundation for continued negotiations. IL Corn will continue monitoring these developments and evaluating their implications for corn, ethanol, and DDGS exports as more details become available.