Following the implementation of U.S. import tariffs on solar panels and washing machines, more recent news regarding potential executive branch trade barriers imposed on steel and aluminum imports have caused concern among some American agricultural groups. China is a leading producer of solar panels and steel, and is also a key export destination for U.S. agricultural exports. As U.S. farm income potentially languishes for another year, export markets have become increasingly important to the value of U.S. crop production. Some observers have cautioned that agricultural products could be targeted by China in retaliation for additional U.S. trade restrictions.
Secretary of Agriculture Sonny Perdue testified before the House Agriculture Committee on Tuesday morning at a hearing on the “State of the Rural Economy.” Recall that back in May, shortly after his confirmation, Sec. Perdue also provided lawmakers on the Committee with an update on rural economic issues. Trade issues with China and the ongoing renegotiation of the North American Free Trade Agreement (NAFTA) were among the key concerns that emerged on Tuesday.
Last week, a Bloomberg news article stated that, "Commodities would be particularly exposed if U.S. President Donald Trump’s decision to impose tariffs on foreign solar panels and washing machines sparks a tit-for-tat trade war with nations around the world...If China wanted to hit back, soybeans could be a weapon."
Financial Times writer Shawn Donnan reported on Monday that, "Talks to renegotiate the North American Free Trade Agreement are moving too slowly, Donald Trump’s trade tsar complained on Monday as he rejected a Canadian proposal to rethink the rules governing the auto trade on the continent."
Jacob M. Schlesinger reported on Tuesday at The Wall Street Journal Online that, "Eleven Pacific Rim nations agreed to forge a new trade bloc [TPP] that excludes the U.S. on Tuesday, as President Donald Trump signed an order to block certain cheap Asian imports [Chinese makers of solar panels and South Korean producers of washing machines], illustrating the battle lines of a new global trade climate."
Cortney Cowley, an economist at the Federal Reserve Bank of Kansas City, indicated in an update last week ("As Winter Looms, Key Risks Keep Ag Outlook Cool") that, "Following steep declines for three consecutive years, farm income was expected to stabilize in 2017 and beyond. In inflation-adjusted dollars, real net farm income was forecast to be relatively unchanged from 2016."
Today’s update provides a brief overview of updated USDA agricultural export data, with particular focus on soybeans and grains.
President Donald Trump addressed the American Farm Bureau Federation’s (AFBF) 99th Annual Convention in Nashville, Tennessee on Monday. The President touched on a variety of issues, including tax reform, regulations, rural broadband, the Farm Bill, crop insurance, and trade. This post highlights some of the key points that the President made in his remarks to the AFBF Members.
President Donald Trump will be in Nashville, Tennessee on Monday to speak at the American Farm Bureau Federation’s (AFBF) 99th Annual Convention. The AFBF noted recently that, "After three consecutive years of decline in farm sector profits, President Trump will speak to Farm Bureau members during a period of prolonged economic challenge across farm country." In fiscal year 2017, the U.S. exported $140.5 billion worth of agricultural products; and, the U.S. Department of Agriculture explained recently that, “Exports are responsible for 20 percent of U.S. farm income, also driving rural economic activity and supporting more than one million American jobs both on and off the farm.” AFBF members will be keenly interested in any remarks the President makes regarding trade policy, and the North American Free Trade Agreement (NAFTA) on Monday. With this in mind, today's update focuses on recent NAFTA developments and agriculture.
In the last few days, USDA's Economic Research Service (ERS) and Foreign Agricultural Service (FAS) have released three separate reports that contain current information relating to dairy sector analysis in China, U.S. livestock trade, and the the U.S.-Korea Trade Agreement (KORUS). This update briefly highlights core points from the three USDA reports.