Farm groups are ‘concerned’ with tariff impositions

Farm leaders expressed their “concerns” with the Trump administration’s May 31 imposition of 25 percent tariffs on steel and 10 percent tariffs on aluminum from Europe, Mexico and Canada, driving calls for retaliation, and increasing uncertainty for American farmers and ranchers.

U.S. Grains Council President and CEO Tom Sleight said in a statement, “The U.S. Grains Council is deeply concerned about new tariffs set to be implemented at midnight on steel and aluminum from Mexico, Canada and the European Union, three key markets for U.S. grain and related products.

“Based on information we have heard from our customers and past experience, we have every reason to believe U.S. agriculture, including the products we represent, will be among the first hit by counter measures from our trading partners.

“These countries are among our closest neighbors and friends. We have spent years building markets in these countries based on a mutual belief that increasing trade benefits all parties.

“We had strong hopes this situation would be averted permanently, but it now appears we need to prepare for retaliation and its direct impact U.S. farmers. Our global staff is doing this to the best of their abilities as we continue to follow new developments.”

Jim Heimerl, president of the National Pork Producers Council and a hog farmer from Johnstown, Ohio, said his group “has consistently stated its concern about retaliation against U.S. agriculture, including pork, in response to tariffs placed by the United States on steel and aluminum imports.

“(The) decision to impose tariffs on steel and aluminum from Mexico and Canada, critical export markets, significantly heightens our concern as Mexico is already threatening to retaliate against U.S. pork. U.S. pork shipped $1.5 billion of product to Mexico, its largest export market, and $792 million to Canada, its fourth-largest market, last year.

“Global export market uncertainty has resulted in considerable lost value for U.S. pork producers. According to Iowa State University Economist Dermot Hayes, hog futures dropped $18 per animal, amounting to a $2.2 billion loss on an annualized basis, since March 1 when speculation about U.S. pork access to the critical Chinese market began.

“The market disruption caused by export market uncertainty comes at a time when U.S. pork is expanding production to record levels. Five new pork processing plants have recently opened or will soon begin operations, increasing U.S. pork production capacity by approximately 10 percent from 2015 levels by next year. Exports accounted for more than $53 of the average $149 value of a hog last year and support over 110,000 U.S. jobs.

“We call for an end to these trade disputes so that hard-working U.S. pig farmers can do what they do best: meet global demand for one of our nation’s most competitive export products, one that favorably impacts U.S. trade imbalances with countries around the world.”

North Dakota farmer Kevin Skunes, president of the National Corn Growers, reacted in a statement, “Farmers are busy with planting season but are moving forward without knowing who will buy their crop when it’s harvested later this year. With a 52 percent drop in net farm income over the last five years and depressed commodity prices, this is not the time to face such a burden. This uncertainty impacts every step of the agriculture economy, from securing financing to marketing.

“Imposing tariffs has the potential to undermine positive relationships with our closest allies and erode long-standing market access. NCGA urges policymakers to strengthen cooperation with our trading partners and stay at the negotiating table.”

National Farmers Union President Roger Johnson said, “Unfettered free trade has characterized U.S. trade relationships for many decades, often at substantial cost to our farmers and ranchers and our nation’s economy. Though we agree with President Trump’s inclination to address unfair trading practices and reduce our trade deficit, provoking a global trade war with our closest allies hardly seems like a solution.

“Indeed, these on-again, off-again tariffs will likely result in the opposite of their intended effects. Agriculture is always the first casualty of retaliatory tariffs, and it is no different in this instance. All targeted countries have already announced that they will levy taxes on a number of U.S. agricultural products, which could have widespread, negative consequences for family farmers and ranchers.

“Family farmers and ranchers are already experiencing severely depressed farm prices and a 12-year low in farm income. They cannot afford to serve as collateral in a trade war. We again urge President Trump and his administration

work with Congress to immediately put a plan in place to protect farmers, ranchers and rural communities from retaliatory actions.”

Casey Guernsey, a former Missouri state legislator and spokesman for Americans for Farmers and Families’ “Retaliation Hurts Rural Families” initiative, said, “The administration’s decision to move forward with sweeping tariffs on steel and aluminum imports from our closest trading partners is a one-two punch for the millions of farmers and families who rely on these critical markets every day.

“Not only will these tariffs threaten rural Americans’ ability to sell their homegrown goods with key U.S. allies—it puts the future of the North American Free Trade Agreement in jeopardy. As we continue to grapple with the inevitable retaliation from China as a result of more U.S. tariffs, the last thing we need is more uncertainty or retaliation from Mexico, Canada and the European Union.

“The facts are clear: Sweeping tariffs in any sector result in retaliatory measures that make it significantly harder for farmers to sell their homegrown goods to customers around the world. With farm income at a 12-year low, American farmers need a win now more than ever. Unfortunately, these latest tariffs will do just the opposite.

“We urge the Trump administration to reverse this misguided decision and instead focus on modernizing and strengthening critical trade agreements like NAFTA. This action would show American farmers that their trust was not misplaced and provide the certainty we need to continue feeding families across the globe.”

U.S. Wheat Associates President Vince Peterson said, “It is dismaying to see that common sense has not yet prevailed in preventing these protectionist measures. We’ve spent decades in critical markets like Mexico, Japan, Europe and others because we’re committed to a lasting trading relationship between their milling and processing sectors and our farmers. If this administration isn’t careful decades of efforts by our farmers could be wasted.”

Larry Dreiling can be reached at 785-628-1117 or [email protected].