Trade threats sow unease on the farm
It has never been easy to be a farmer. In recent years, it only seems to get more difficult.
Crop prices are down 40 percent since 2013 and farm income has fallen by half. Margins are slim, and every bump in the agricultural economy pushes more farms over the edge.
“It’s tough right now,” Roger Headley, a western Michigan dairy farmer dairy farmer, said at an auction where another farmer liquidated his herd. “You don’t make enough to pay the bills.”
Nate Elzinga, 32, said his family wasn’t making enough money to keep up with maintenance costs of their cows. “We just aren’t getting paid enough for our milk,” Elzinga said. “It’s supply and demand.”
The news out of Washington isn’t helping. Whatever that news is. President Donald Trump, his political allies and opponents and their counterparts around the world aren’t helping. The president threatened China with broad import tariffs. The Chinese threatened back with tariffs on U.S. exports, specifically targeting agricultural goods. Trump’s economic advisers say there are back-channel negotiations underway with China. China says it is too late for negotiations. As one of his first acts as president, Trump pulled out of the Trans-Pacific Partnership, an 11-nation free trade agreement among some of the largest economies in the world. On Thursday, he said he was directing advisers to look into rejoining the alliance.
It should make your head swim.
Farm state leaders in Congress welcomed the idea.
In 2017, China imported 1.4 billion bushels of U.S. soybeans, 62 percent of total U.S. exports and nearly one-third of U.S. farmers’ annual soybean production. Soybeans are St. Clair County’s largest crop and biggest export. China said it would slap a 25 percent tariff on U.S. soybeans if Trump carried through on his threat.
If that happened, U.S. soybean exports to China could drop dramatically as it shopped for lower priced soybeans elsewhere in the world.
“Retaliation by China against U.S. tariffs would undercut prices received by soybean producers and further hurt the already depressed farm economy,” John Heisdorffer, president of the American Soybean Association, told the House Agriculture Committee this week.
The farm economy is not being helped by all the uproar, threat and counter-threat. Soybean futures have whipsawed up and down since the trade war of words began, adding uncertainty and anxiety to farming’s financial headache. It is spring in the United States and farmers need to know now if their soybeans have a future buyer.
Talk may be cheap, but it has expensive ramifications for farmers.
— Times Herald (Port Huron)