Company: AGM-PH
Filing Date: 2025-05-09
Form Type: 10-Q
Source: 0000845877-25-000152
Chunk: 90

Company: FEDERAL AGRICULTURAL MORTGAGE CORP
Filing Date: 2025-05-09
Form: 10-Q
Item: Part I, Item 1
Chunk 90
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 infrastructure sector. Changes in tax policy as well as trade and immigration laws could result in significant impacts to infrastructure borrowers, especially for renewable energy projects. These changes could lead to delays in completing current projects and slow future investments in renewable energy and battery storage projects as well as the deployment of fiber and broadband infrastructure in rural areas. Any lack of availability or increased costs of components or technology that results from tariffs or trade restrictions also could lead to delays in completion or slow future investments in infrastructure projects. The infrastructure sector may experience varying degrees of disruption and adaptation in response to these evolving policies, and these changes could increase the volatility of sector profitability in the near-term. The potential for disruption in these sectors due to policy changes may be somewhat mitigated by the historically strong market demand for connectivity, the ongoing diversification of infrastructure providers, and continued strong investments in data centers and fiber infrastructure. 

Legislative, Regulatory, and Political Outlook

Farmer Mac continues to closely monitor executive branch actions and potential legislative and regulatory changes that could significantly impact the organization, its regulatory environment, the borrowers under the loans it owns or guarantees, or its stakeholders, including:

•On April 2, 2025, the Administration issued an executive order unveiling a wide-ranging tariff plan. The order invokes authorities under the International Emergency Economic Powers Act of 1977 (IEEPA) and cites that a lack of reciprocity and persistent trade deficits are a threat to U.S. national security. Using the IEEPA authority, the Administration placed a universal tariff of 10 percent on all countries. These new tariffs were set to take effect on April 5, 2025. Major U.S. trading partners announced retaliatory tariffs in response, and the U.S. government responded in kind. On April 9, 2025, the United States government paused the retaliatory tariffs on dozens of U.S. trading partners for 90 days, leaving in place the universal 10 percent tariff announced on April 2, 2025, as well as previous tariffs that were in place. The 90-day pause on reciprocal tariffs did not apply to China, which is a large export market for U.S. agricultural goods. 

Export markets drive demand for some U.S. agricultural products such as almonds, pistachios, grains, and livestock. Tariffs and trade restrictions may lead to higher domestic inventory levels of agricultural commodities, resulting in lower prices which may affect the profitability of farmers and ranchers. Reciprocal tariffs may impact the cost and availability of some farm inputs