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A trade war will harm American growers and the biotech firms who help them increase productivity, according to the Biotechnology Innovation Organization (BIO).
President Trump sparked fears of a global trade war on April 2, when he announced a baseline 10% tariff against all countries plus reciprocal tariffs of as much as 50% for many countries. He changed course, for the most part, on April 9, announcing a 90-day pause on most reciprocal tariffs while raising tariffs on China to 125%.
China responded with identical counter-tariffs on April 11 that are expected to take a big bite out of America’s agricultural exports.
BIO had already shared a survey of its biopharma member companies showing that the impact on pharmaceuticals from tariffs could be harmful. But there is also a serious threat to agriculture in general, and the biotech innovators serving agriculture, according to Regina Black, BIO’s Senior Director for International Policy and Market Access on the Agriculture & Environment team.
In particular, agriculture, and by extension ag biotech, is exposed to retaliation from countries that have been hit by U.S. tariffs, like the new duties announced by China, Black said.
“Approximately 20% of what the U.S. grows is exported,” according to Black. “Given the economic impact of the farm economy and political importance of rural America, agriculture tends to be one of the first sectors that’s hit with any type of trade war retaliation. If we’re not able to export or it’s coming at a higher cost, it’s going to harm farmers. It hurts their bottom line and we lose market share around the world.”
The biotech firms that serve the agriculture and environment sector will “obviously” be impacted, Black said. “If things like products that are grown with biotech seeds or traits are not being grown or exported, that harms our companies.”
Losing our edge in negotiations
A longer-term concern regarding tariffs is the possibility of a change in America’s ability to negotiate with trading partners over issues that impact biotech, according to Black. Drawn-out trade conflicts could erode trust and impede efforts at streamlined regulation—though if handled well, new negotiations might be helpful, she said.
“A lot of the countries that were hit hard by these tariffs are countries that we have been working diligently with over the last several years to improve our relationship when it comes to biotech approvals, China being one of them,” Black said.
The previous Trump administration in 2020 negotiated the Phase One Agreement, which was supposed to mean China would grant faster approval of agricultural biotech products. The U.S. has complained that China is not honoring that agreement, but some progress was noted.
A trade stand-off could further slow regulatory approvals, in China or any other countries harmed by tariffs, Black said. In fact, approvals could be slowed intentionally, as a bargaining chip when other countries are looking for non-tariff means of retaliation.
On the other hand, if the tariffs lead to new trade negotiations, faster approval of biotech products could—and should—be part of the discussion, Black said.
“This is something that we will pay very close attention to,” she said. “If these tariffs do lead to the opportunity to come back to the negotiating table, it could give us a chance to lean in and to address some of those long-standing issues, like delays in approval of new genetic traits or regulatory processes. It could end up being a positive.”
