Agricultural exports of grain and meat are caught in the middle of a failed attempt to resolve trading disparities with China. What may happen to farm income this year?
United States and Chinese officials wrapped up trade talks with no deal. However, there was not any breakdown in talks, even as the U.S. Trade Representative moved forward on raising import tariffs from 10- to 25-percent on $200 billion in Chinese goods. Farmers and agricultural organizations across the country are very concerned about the move.
The National Association of Wheat Growers, American Soybean Association and National Corn Growers Association were hoping a deal would be in place by March 1, right before farmers started back in fields. Instead, the trade war with China is escalating.
“U.S. wheat growers are facing tough times right now,” says National Association of Wheat Growers president Ben Scholz. “These additional tariffs will continue to put a strain on our export markets and threaten decades worth of market development efforts.”
Davie Stephens, president of the American Soybean Association, says his group believes President Trump supports farmers.
“We’d like the President to hear us and believe what we are saying about consequences as the trade war drags on,” Stephens says. “Adding to the current problems, it took us 40 years to develop the China soy market. For most of us in farming, that’s two-thirds of our lives.”
Lynn Chrisp, president of the National Corn Growers Association, says corn farmers are watching the tariff battle as many can’t get into fields to plant this year’s crop due to wet weather. The Trump Administration says China has three to four weeks to come to an agreement, or face tariffs on $325 billion of items currently not covered by duties.
However, U.S. Ag Secretary Sonny Perdue, in a tweet, said he was on the phone with President Trump and discussed the increase in tariffs. Perdue’s tweet says, “While China may backtrack, @POTUS is steadfast in his support for U.S. farmers. He directed @USDA to quickly put together a plan to help American farmers. @POTUS loves his farmers and will not let them down!”
President Trump said in a tweet, on Friday, that the increase in tariffs will be used to buy farm goods. He expects the new duties to generate more than $100 billion in extra revenue.
The President was unhappy with the pace of negotiations and increased duties from 10- to 25- percent on $200 billion worth of Chinese goods. In a Friday tweet, Trump said, “You’re all-time favorite president got tired of waiting for China to help out and start buying from our FARMERS, the greatest anywhere in the world!” Beijing has retaliated in kind with $60 billion in additional tariffs on U.S. imports to China.