Trump's trade deal with China is just another farm bailout

[corbe]

Trump's trade deal with China is just another farm bailout

by Halie Craig

January 07, 2020 12:39 PM

The last thing American farmers needed in 2018 was a trade war with China. Commodity prices had been falling since 2013, land values remained stagnant, and net cash income for farms was declining steadily, dropping 34% between 2012 and 2016.

By ensnaring the agricultural sector in a trade war that was supposed to be about intellectual property issues, the subsequent onslaught of tit-for-tat tariffs between Washington and Beijing, including Chinese retaliatory tariffs on virtually every U.S. farm product, made matters much worse. In the year preceding the trade war, U.S. farm exports to China totaled $19.5 billion. By the end of the following year, they had declined 53% to just $9.2 billion.

Certain products that are particularly reliant on trade with China took big hits: In 2018, soybean exports to China dropped 74% by value, hides and skins dropped 36%, and wheat dropped 70%.

Other indicators of the American agriculture sector’s health have also been trending negatively. Bankruptcy filings for farms have escalated, farm debt is projected to reach a record high, farmer suicides are on the rise, and heartbreaking stories of struggling family farms often make national news. This is why President Trump’s Dec. 13 announcement of a “phase one” trade agreement with China was met with hesitant optimism from the farm community.

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https://www.washingtonexaminer.com/opinion/trumps-phase-one-china-trade-deal-is-just-another-farm-bailout

[IsailedawayfromFR]

Trump's trade deal with China is just another farm bailout

by Halie Craig

January 07, 2020 12:39 PM

The last thing American farmers needed in 2018 was a trade war with China. Commodity prices had been falling since 2013, land values remained stagnant, and net cash income for farms was declining steadily, dropping 34% between 2012 and 2016.

By ensnaring the agricultural sector in a trade war that was supposed to be about intellectual property issues, the subsequent onslaught of tit-for-tat tariffs between Washington and Beijing, including Chinese retaliatory tariffs on virtually every U.S. farm product, made matters much worse. In the year preceding the trade war, U.S. farm exports to China totaled $19.5 billion. By the end of the following year, they had declined 53% to just $9.2 billion.

Certain products that are particularly reliant on trade with China took big hits: In 2018, soybean exports to China dropped 74% by value, hides and skins dropped 36%, and wheat dropped 70%.

Other indicators of the American agriculture sector’s health have also been trending negatively. Bankruptcy filings for farms have escalated, farm debt is projected to reach a record high, farmer suicides are on the rise, and heartbreaking stories of struggling family farms often make national news. This is why President Trump’s Dec. 13 announcement of a “phase one” trade agreement with China was met with hesitant optimism from the farm community.

<..snip..>

https://www.washingtonexaminer.com/opinion/trumps-phase-one-china-trade-deal-is-just-another-farm-bailout

I don't buy that.

US Farmers produce food which the world needs.  China also needs food and needs it desperately, regardless of imposed tariffs.

What the farmers really fear the most is taking away mandates for ethanol, which the world does not need. 

[jmyrlefuller]

Hides and skins (e.g. leather): OK, because a lot of that is used in apparel, those who sell those animal byproducts might be hurt... though if American manufacturing continues to recover, there might be more of a domestic market to pick up that slack.

But wheat and soybeans are stereotype crops. It's probably not Red China trade that's hurting the price. It's the fact that everyone grows it. There are so many types of legumes to grow, and yet soybeans are all that ever get attention in the agribusiness community... while we wonder why the market is flooded with soybeans.