After the Trump Administration announced it is moving forward with $50 billion in tariffs on Chinese products, the Sleeping Giant snapped back with a 25 percent retaliatory tariff on multiple U.S. goods. The retaliatory tariff includes soybeans, cotton, sorghum, wheat, vegetables, beef, pork, and more and will go into effect on July 6.
The American Soybean Association is disappointed in the Administration’s decision, which follows weeks of imploring the President and his team to find non-tariff solutions to address Chinese intellectual property theft and not place American farmers in harm’s way. ASA has twice requested a meeting with President Trump to discuss how increasing soy exports to China can be a part of the solution to the U.S. trade deficit without resorting to devastating tariffs.
A study by Purdue University economists predicts that soybean exports to China could drop by as much as 65 percent if China imposes a retaliatory 25 percent tariff on U.S. soybeans.
Davie Stephens, Kentucky soybean grower and Vice President of ASA, is among growers distraught over the newly-announced tariffs, and China’s possible retaliation.
“Crop prices have dropped 40 percent in the last five years, and farm income is down 50 percent compared to 2013. As a soy grower, I depend on trade with China. China imports roughly 60 percent of total U.S. soybean exports, representing nearly 1 in 3 rows of harvested soybeans,” Stephens said. “This is a vital and robust market that soy growers have spent over 40 years building and, frankly, it’s not a market U.S. soybean farmers can afford to lose.”
ASA is among grower and industry groups whose members have been imploring Congress to urge the Administration to back away from tariffs and return to the negotiating table with China. Under the hashtag #TradeNotTariffs, members of these organizations have continued to amp up awareness on social media, sharing with the public how trade tariffs could devastate their livelihoods.
The tariff announcement comes a month after China terminated anti-dumping and countervailing duty investigations into U.S. sorghum, which ended the 178.6 percent duty. The newly enforced 25 percent tariff will bring higher prices for Chinese consumers who purchase over half of U.S. sorghum exports.
“National Sorghum Producers, alongside our producers, stakeholders, and partners, have already seen the market uncertainty and price fluctuations that occur when China retaliates on U.S. goods. We urge President Trump and the Administration to move forward with constructive trade negotiations that will end tariffs on U.S. agriculture, especially during times of existing economic stress,” National Sorghum Producers Chairman and Nebraska farmer Don Bloss. “We understand the grave impact tariff decisions can inflict on producers. American farmers depend on trade with China, and these tariffs will have devastating effects on U.S. agriculture. We greatly value our business relationship with Chinese buyers and hope to see this win-win relationship move forward. We have witnessed the Administration’s efforts in positive trade negations in the past that lifted sanctions on U.S. sorghum and hope to see similar efforts going forward.”
“For American farmers this isn’t theoretical anymore, it’s downright scary. It’s no longer a negotiating tactic, it’s a tax on their livelihoods. Within days, soybean, corn, wheat and other American farmers are likely to be hit with retaliatory tariff of up to 25% on exports that keep their operations afloat. When they do, they’re not going to remain silent,” Farmers for Free Trade Executive Director Brian Kuehl said. “The imposition of these tariffs is not only a blow to our farmers, it’s a win for our competitors. When American soybeans and corn become more expensive, South America wins. When beef becomes more expensive, Australia wins. As this trade war drags on, farmers will rightly question why our competitors are winning while we’re losing.”
Tags: Agribusiness, Agriculture News, Exports and Imports