Struggling US Farm ETFs Face New Threat: China Tariffs

DJ Shaw

Thu, Mar 6, 2025, 7:00 AM 3 min read

American agricultural exchange-traded funds took another hit as China announced 10% to 15% retaliatory tariffs on U.S. farm products, affecting approximately $21 billion worth of agricultural exports. According to etf.com data, the sector's farm ETFs were already experiencing monthly declines before Beijing's latest trade countermeasures.

For ETF investors, the timing couldn't be worse as these agriculture funds were already bleeding assets, with three of the four major funds reporting negative flows in recent months, creating a double blow to an already struggling sector.

The most recent etf.com data show one-month performance falling across the board, with the Teucrium Corn Fund (CORN) down 8.1%, the Teucrium Wheat Fund (WEAT) down 7.7%, the Teucrium Soybean Fund (SOYB) down 7.5% and the Teucrium Sugar Fund (CANE) sliding 0.1%.

The dollar impact is clear, with WEAT seeing outflows of $1.22 million in the past month alone. CORN has lost $1.87 million in the same period, while SOYB has shed $539,300 and CANE has experienced $2.7 million in outflows.

Looking at longer periods, the picture grows darker for most funds. SOYB has been hit hardest over the past year with returns down 13.6% and assets under management of $26.1 million, according to etf.com data. Despite the challenging environment, it has managed a slight three-month gain of 0.2%.

WEAT, the largest of the group with $116.4 million in assets, posted a one-year loss of 11%. Its performance has been consistently negative with a three-month decline of 1.3% and year-to-date loss of 2.5%.

CORN, with $59.4 million in assets, has seen annual returns of -5.4%. While it has shown some resilience with a three-month gain of 4.3%, it remains down 1.3% year to date.

Even CANE, with its $11.4 million in assets, hasn't escaped the downturn with a one-year loss of 7.9%. However, it's the only fund showing positive year-to-date performance at 1.7%, despite a recent three-month dip of 7%.

The year-long impact shows WEAT experiencing outflows of $26.2 million, while CORN has seen $4.3 million in outflows. SOYB has been the exception with $3 million in positive flows annually.

These impacts may intensify as China further diversifies its agricultural supply chains. According to Reuters, "Since the United States and China imposed tit-for-tat tariffs during Trump's first term, Beijing has moved to cut its reliance on American farm goods by spurring domestic production and buying more from countries such as Brazil."