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Perdue: Patience Needed in Trade Talks

In Kansas visit, USDA Secretary talks trade, market assistance, and immigration.

To farmers and ranchers affected by President Donald Trump’s trade policy, Secretary of Agriculture Sonny Perdue is preaching patience.

In a conversation with reporters following a lecture at Kansas State University in Manhattan, Kansas, on November 1, Perdue reiterated President Trump’s claim that playing the long game – waiting out while negotiators hammer out solutions to trade disputes – will pay off for the agriculture community.

According to Perdue, farmers tend to support President Trump’s trade agenda, which focuses on fair trade with current partners coupled with expanding markets to new nations to spread risk, rather than catering to China. The President believes China does not trade fairly.  

“I’m concerned that we may have grown too dependent on a major customer that doesn’t have our best national interest,” Perdue says. “There are a lot of hungry mouths out there. You look at India, which probably has almost equal population to China. It’s virtually untapped from our agricultural sector.

“We’ve got to go build those markets as well, but I’m very proud of our agricultural community for not playing the blame game,” he continues. “They’re hurting obviously economically, but they’ve remained very supportive of a long game that the president wants of fair trade,” he says.

American agricultural goods were a heavy casualty of the Trump administration’s trade policy. As such, the federal government appropriated $12 billion for federal Market Facilitation Program payments, intended to offset some income due lost export markets. The first half of those payments should be in farmers’ hands by now. Perdue says he is “99.9%” sure that the second round of payments will come, with a target date of mid-December.

The MFP payments are not intended to replace income lost by export restrictions, but should help ease some financial pain, he says. However, farmers shouldn’t expect any similar program for 2019, as they should be able to adapt crop rotations for the growing season.

“There’s no expectation we’ll have a 2019 program. I felt compelled to recommend this to the president’s administration in this year, because [farmers] could not anticipate this when they planted in the spring,” Perdue says. “Farmers are used to the volatility of prices, they’re used to this economic distress, although none of us like it and we hope for better markets and that’s why we’re going around the world trying to develop those markets.”

Discussions with China on resolving the trade dispute are ongoing. “I’m optimistic that this can be resolved at the highest levels,” he says. “President Trump has many times mentioned the respect that he has for [China President] Xi, and I think again President Xi has to understand that President Trump is a pretty determined kind of person when it comes to fairness on trade issues.”

Other Issues

Secretary Perdue addressed several additional topics during his Kansas stop. Among them:

  • Farm Bill Passage: Perdue anticipates work on the Farm Bill will resume after next week’s elections, and perhaps be complete by the end of the calendar year. “The good news is that the 2014 farm bill continues on and farmers will not really notice a difference, unless we get it done by the end of the year,” he says.
  • Immigration Reform: The Departments of Labor, Homeland Security, and State are working on reform of the H2A guest worker visa program. USDA will be a facilitator of that program, Perdue says, and administer visa applications through a web portal. Perdue reiterates that President Trump is aware of the importance of agricultural labor.
  • Disaster assistance for Hurricane Michael: While damage assessments are ongoing for farmers in the Southeast harmed by Hurricane Michael last month, Perdue – a native of Georgia – knows that damage is significant. Potentially record-breaking cotton, peanut, and pecan crops were decimated. Congress last year authorized the Wildfire and Hurricane Indemnity Program to aid farmers and others. “I would hope that Congress would give us the statutory authority to expand that to the 2018 hurricanes Florence and Michael as well, because destruction has been much the same, or even greater than last year,” he says.
  • Moving departments outside D.C.:  After Secretary Perdue announced in September that it would entertain moving both the National Institute for Food and Agriculture and Economic Research Service departments out of Washington, D.C., 34 states expressed interest in hosting the agencies. USDA has engaged Ernst and Young to help develop relocation criteria. After that, the areas expressing interest will be given another opportunity to respond to the query. If the agencies move, a decision on where they will move to will be made in the first quarter of 2019, Perdue says.

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