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Trump Writes Soybean Farmers Second Check for Tariff Troubles

Producers need only to sign up once for the MFP to be eligible for the first and second payments.

The government will pay up to $9.6 billion to crop and livestock producers to buffer the impact of the Sino-U.S. trade war, announced Agriculture Secretary Sonny Perdue on Monday, with the release of a second and final round of $4.7 billion in the Trump tariff payments.

“While there have been positive movements on the trade front, American farmers are continuing to experience losses due to unjustified trade retaliation by foreign nations,” said Perdue. “This assistance will help with short-term cash flow issues as we move into the new year.”

The money was released two weeks later than expected because White House budget officials hoped for a revival of U.S.-China trade after a face-to-face meeting of President Trump and Chinese President Xi Jinping. China purchased 1.4 million tonnes of soybeans last week but sales to the former No. 1 export customer are far below normal.

“While this assistance package will help a number of our farm families during this year of severe economic challenge, the best way to provide lasting relief is to continue pushing for trade and tariff reform from trading partners like China, Canada, Mexico, India, Turkey, and the European Union,” said Farm Bureau president Zippy Duvall. Wheat Growers president Jimmie Musick said wheat sales to China and Mexico are down by $500 million since the trade war began in early summer.

“These retaliatory tariffs are not only harming growers through loss of sales but are also placing pressure on wheat prices,” said Musick. “Growers want new export markets and trade deals so that this sort of assistance isn’t necessary.”

All told, the Trump administration will spend as much as $11 billion to offset the impact of the trade war on U.S. agriculture. Besides the $9.6 billion in cash payments to producers, the USDA will spend $1.2 billion on purchases of surplus food and provide $200 million for trade promotion work by ag export groups. In July, Perdue said up to $12 billion was available. Since then, a USDA spokesperson said there would be only one round of purchases of surplus food and trade promotion awards.

As of Monday, $2.38 billion has been paid to producers, said USDA. Illinois, Iowa, Kansas, and Nebraska are the leading states for payments, and the top commodities for payments are soybeans, corn, wheat, dairy, and sorghum.

The USDA said soybean growers would see a maximum of $7.3 billion in payments, based on a payment rate of $1.65 per bushel. Soybeans used to be the largest U.S. farm export to China. Up to $581 million would go to hog farmers and $554 million to cotton growers.

Wheat, corn, and dairy groups have said payment rates for their commodities were unduly low. The corn rate is 1¢ a bushel, wheat 14¢ a bushel, and milk 1¢ a gallon.

Receiving Payments

Producers need only to sign up once for the market facilitation program to be eligible for the first and second payments. For farmers who have already applied, completed harvest, and certified their 2018 production, a second payment will be issued on the remaining 50% of the producer’s total production.

Commodity First and Second Payment Rate Est. Total Payment (in $1,000s)
Cotton $0.06 / lb. $553,800
Corn $0.01 / bu. $192,000
Dairy (milk) $0.12 / cwt. $254,800
Pork (hogs) $8.00 / head $580,600
Soybeans $1.65 / bu. $7,259,400
Sorghum $0.86 / bu. $313,600
Sweet cherries (fresh) $0.16/ lb.  $11,500
Almonds (shelled) $0.03 / lb. $63,300
Wheat $0.14 / bu.

$238,400

Total $9,567,400
Produced with FERN, non-profit reporting on food, agriculture, and environmental health.
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