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‘By the Time I Finish,’ Barriers to U.S. Ag Exports Will Be Down, Trump Says

President Trump told American farmers on Monday, “By the time I finish trade talks,” China, Canada, and Mexico, the three largest customers for U.S. farm exports, will remove trade barriers to American products. The president issued the assurances on social media after inconclusive talks with China over the weekend and three days after he said he was open to separate trade deals with Mexico and Canada instead of an updated NAFTA.

Agriculture Secretary Sonny Perdue has focused on larger farm exports as the lever to elevate farm income, which slumped with the collapse of the commodity boom in 2013. Exports generate 20¢ of each dollar in farm income.

Trump has announced tariffs on China, Canada, Mexico, and the European Union in the name of national security, bringing threats of tit-for-tat tariffs aimed at farm goods and other U.S. products. During talks in Beijing over the weekend, Chinese officials said they would not expand purchases of farm exports if the United States followed through on 25% tariffs on $50 billion in Chinese products “containing industrially significant technology.” After a previous meeting, China said it would make substantial increases in imports of U.S. agriculture and energy.

“We continue to prefer talks to tariffs and hope for a successful outcome at the negotiating table,” said the American Farm Bureau Federation, the largest U.S. farm group. “The path to a successful trade agreement is seldom easy.” The second-largest group, the National Farmers Union, said the White House and Congress ought to “immediately put a plan in place to protect farmers, ranchers, and rural communities from retaliatory actions.”

Together, China, Canada, Mexico, and the European Union buy half of U.S. farm exports. The USDA estimates their purchases at $74.2 billion of total farm exports of $142.5 billion this fiscal year.

“The pork industry is caught up in trade disputes,” wrote Purdue economist Chris Hurt at the farmdoc Daily blog. Mexico, which has targeted pork legs and shoulders, sausages, apples, grapes and various cheeses, bought one-third of U.S. pork export tonnage last year. Mexico, Canada and China purchased half of U.S. pork exports in 2017. “There is still hope that differences can be resolved,” said Hurt.

In a series of three tweets, Trump scored China and Canada for meddling in farm trade – “Not acceptable!…The U.S. has made such bad trade deals over so many years that we can only WIN!

“Farmers have not been doing well for 15 years,” said Trump, misstating recent economic history. “Mexico, Canada, China and others have treated them unfairly. By the time I finish trade talks, that will change. Big trade barriers against U.S. farmers, and other businesses, will finally be broken. Massive trade deficits no longer!”

Farmers enjoyed a six-year commodity boom from 2006-13 – the best times since the export explosion of the 1970s – with record-high corn, soybean, and wheat prices and record-setting farm income. Net farm income, a measure of wealth that includes the value of crops held in storage, is forecast at $59.5 billion this year, the lowest since 2006, in the early days of rising commodity prices. Ag exports this year are expected to the second-largest ever.

Rural America backed Trump in the 2016 election and was pivotal to his victory. Often political conservatives, farmers voted for Trump in landslide numbers with his platform of tax reform, regulatory relief, and support for corn ethanol.

White House press secretary Sarah Sanders said negotiations with China will continue. Asked about anxiety in farm country about potential loss of export markets, she replied, “Certainly, the president is trying to do everything he can to protect American farmers, American businesses, and he is negotiating with a number of countries.

“But also, the president wants to make sure we’re ending unfair trade practices. The president has said that he wants to help protect farmers, and we’re looking at a number of different ways to do that.”

Produced with FERN, non-profit reporting on food, agriculture, and environmental health.
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