The American Soybean Association is expressing extreme frustration about the escalation of a trade war with the largest customer of U.S. soybeans, and calling on the White House to reconsider the tariffs that led to this retaliation.
Related: China will impose 25% tariffs on a range of U.S. goods worth about $50 billion in reaction to President Trump’s new tariffs. Chinese officials have not set an implementation date, saying that depends on Trump’s actions. – The Washington Post
China purchases 61% of total U.S. soybean exports, and more than 30% of overall U.S. soybean production.
“It should surprise no one that China immediately retaliated against our most important exports, including soybeans,” said ASA President and Iowa farmer John Heisdorffer. “We have been warning the administration and members of Congress that this would happen since the prospect for tariffs was raised. That unfortunately doesn’t lend any comfort to the hundreds of thousands of soybean farmers who will be affected by these tariffs. This is no longer a hypothetical, and a 25% tariff on U.S. soybeans into China will have a devastating effect on every soybean farmer in America.”
Related: Trump insists the United States is “not in a trade war with China” - Politico
Heisdorffer said the news from China sent soybean futures down nearly 40 cents a bushel, costing soybean farms $1.72 billion in value.
“We regret that the administration has been unable to counter China’s policies on intellectual property and information technology in a way that does not require the use of tariffs,” he said. “We still have not heard a response from the administration to our March 12 letter requesting to meet with President Trump and discuss how the administration can work with soybean farmers and others in agriculture to find ways to reduce our trade deficit by increasing competitiveness rather than erecting barriers to foreign markets.”
Related: U.S. stocks are sinking as fears rise that a trade war is beginning between the world’s two largest economies. – Bloomberg
Heisdorffer says there’s still time for the Trump administration to reverse course.
“China has said that its 25% tariff will only go into effect based on the course of action the administration takes. We call on President Trump to engage the Chinese in a constructive manner—not a punitive one—and achieve a positive result for soybean farmers.”
Other groups weigh in
The Minnesota Soybean Association is likewise expressing “extreme displeasure.”
“In a down farm economy, with farm income down 50% from 2013, this could have a devastating impact on Minnesota’s 28,000 soybean farmers,” says MSGA President Michael Petefish. “The last thing the administration should be doing is starting a trade war on the backs of American farmers.”
Related: The National Cotton Council expressed concern “that China’s announcement of significantly higher proposed tariffs on U.S. raw cotton shipped to that country would significantly harm the economic health of the U.S. cotton industry.” - Delta Farm Press
U.S. Wheat Associates and the National Association of Wheat Growers believe wheat farmers are going to get hurt by the 25% tariffs China proposed after the United States government announced new tariffs on $50 billion of imported Chinese goods.
“People may not know that China imported more than 61 million bushels of U.S. wheat in marketing year 2016/17, making it our fourth largest buyer in the world,” said USW Chairman Mike Miller, a wheat farmer from Ritzville, Wash. “Farmers across the country have invested a lot of money and time over the years to develop a Chinese market that has great potential to buy even more American wheat. Now that effort is in jeopardy at a time when big global supplies have already pushed farm gate wheat prices down to unsustainable levels.”
“America’s wheat farmers are experiencing several hardships and adding a 25% tariff on exports to China for U.S. wheat is the last thing we need during some of the worst economic times in farm country,” stated NAWG President Jimmie Musick a wheat farmer from Sentinel, Okla. “Continued drought, low prices and trade uncertainty adds pressure to passing a Farm Bill on time as well as creating uncertainty for producers and lenders. In a trade war, agriculture is always the first target. The administration can support rural Americans by working with Chinese officials to avoid these damaging tariffs.”
American Farm Bureau Federation President Zippy Duvall called for negotiations.
“Growing trade disputes have placed farmers and ranchers in a precarious position,” Duvall said. “We have bills to pay and debts we must settle, and cannot afford to lose any market, much less one as important as China’s. We urge the United States and China to return to negotiations and produce an agreement that serves the interests of the world’s two largest economies.”
National Farmers Union President Roger Johnson called on Congress to protect farmers and ranchers from the “collateral damage” that has resulted from the decision to impose tariffs.
“As trade tensions escalate, Farmers Union is increasingly concerned that there is not a plan in place to protect our family farmers and ranchers who are always the first to bear the brunt of retaliatory tariffs,” Johnson said. “Farmers are dealing with severely depressed farm prices and a 12-year low in farm income, and a trade war will undoubtedly make these conditions worse.
The National Sorghum Producers said the tariffs will mean additional financial burdens for U.S. sorghum farmers.
“The proposed tariffs are not immediate and the timing of possible additional tariffs remains uncertain,” said NSP Chairman and Nebraska farmer Don Bloss. “But the financial toll on our producers is already taking place with this morning’s widespread market reaction to the announcement by the Chinese government.”
Sorghum producers saw a similar reaction after the administration imposed tariffs on imports of solar panels and washing machines from China and China retaliated by announcing anti-dumping and countervailing duty investigations on imports of U.S. sorghum.
Source: ASA, MSGA, U.S. Wheat Associates, NAWG, AFBF, NFU, National Sorghum Producers